Commodity prices rallied to multi-month highs this week on increasing signs that the worst of the world recession may be over.
“The recent surge in commodity prices appears to have been driven primarily by hopes of a strong recovery in the global economy,” Capital Economics analyst Julian Jessop said.
“However, there are still many reasons to be cautious. For a start, although some commodity firms have undoubtedly taken advantage of lower prices to rebuild stocks in anticipation of a pick-up in final demand, that increase in demand has yet to materialize,” he said.
OIL: New York crude oil hit US$70 for the first time in seven months on Friday as the US dollar slid on news of a dramatic slowdown in US job losses, traders said.
New York crude spiked to US$70.32 a barrel, the highest level since Nov. 4. It later retreated sharply as the dollar recovered.
“This initial rally in crude looks to have failed,” aided by a recovering dollar, said Adam Klopfenstein, senior market strategist at Lind-Waldock.
A struggling US currency makes dollar-priced crude cheaper for buyers holding stronger currencies, in turn stimulating demand and pushing up prices. When the dollar strengthens the reverse tends to apply.
After plunging from record highs above US$147 last July on supply concerns, oil prices touched multi-year lows in December, at one point nearing US$32 a barrel, as the economic slowdown crushed demand for energy.
On Friday, on the New York Mercantile Exchange (NYMEX), light sweet crude for delivery in July closed at US$68.44 a barrel from US$65.94 a week earlier. It was down US$0.34 from Thursday, after a jump to US$70.32 a barrel, the highest level since Nov. 4.
On London’s InterContinental Exchange (ICE), Brent North Sea crude for July climbed to US$68.34 a barrel from US$65.05 a week earlier. Brent crude fell US$0.37 from Friday, having spiked as high as US$69.91.
PRECIOUS METALS: Gold prices approached US$1,000 an ounce before traders cashed in their gains late on. By late Friday on the London Bullion Market, gold fell to US$962 an ounce from US$975.50 a week earlier.
Silver rose to US$15.65 an ounce from US$15.52.
On the London Platinum and Palladium Market, platinum climbed to US$1,275 an ounce at the late fixing on Friday from US$1,175.
Palladium jumped to US$257 an ounce from US$236.
GRAINS AND SOYA: Soya and grains prices traded mixed.
By Friday on the Chicago Board of Trade, maize for delivery in July rose to US$4.45 a bushel from US$4.36 a week earlier.
July-dated soyabean meal — used in animal feed — increased to US$12.29 from US$11.84.
Wheat for July fell to US$6.28 a bushel from US$6.37.
NO HUMAN ERROR: After the incident, the Coast Guard Administration said it would obtain uncrewed aerial vehicles and vessels to boost its detection capacity Authorities would improve border control to prevent unlawful entry into Taiwan’s waters and safeguard national security, the Mainland Affairs Council (MAC) said yesterday after a Chinese man reached the nation’s coast on an inflatable boat, saying he “defected to freedom.” The man was found on a rubber boat when he was about to set foot on Taiwan at the estuary of Houkeng River (後坑溪) near Taiping Borough (太平) in New Taipei City’s Linkou District (林口), authorities said. The Coast Guard Administration’s (CGA) northern branch said it received a report at 6:30am yesterday morning from the New Taipei City Fire Department about a
IN BEIJING’S FAVOR: A China Coast Guard spokesperson said that the Chinese maritime police would continue to carry out law enforcement activities in waters it claims The Philippines withdrew its coast guard vessel from a South China Sea shoal that has recently been at the center of tensions with Beijing. BRP Teresa Magbanua “was compelled to return to port” from Sabina Shoal (Xianbin Shoal, 仙濱暗沙) due to bad weather, depleted supplies and the need to evacuate personnel requiring medical care, the Philippine Coast Guard (PCG) spokesman Jay Tarriela said yesterday in a post on X. The Philippine vessel “will be in tiptop shape to resume her mission” after it has been resupplied and repaired, Philippine Executive Secretary Lucas Bersamin, who heads the nation’s maritime council, said
CHINA POLICY: At the seventh US-EU Dialogue on China, the two sides issued strong support for Taiwan and condemned China’s actions in the South China Sea The US and EU issued a joint statement on Wednesday supporting Taiwan’s international participation, notably omitting the “one China” policy in a departure from previous similar statements, following high-level talks on China and the Indo-Pacific region. The statement also urged China to show restraint in the Taiwan Strait. US Deputy Secretary of State Kurt Campbell and European External Action Service Secretary-General Stefano Sannino cochaired the seventh US-EU Dialogue on China and the sixth US-EU Indo-Pacific Consultations from Monday to Tuesday. Since the Indo-Pacific consultations were launched in 2021, references to the “one China” policy have appeared in every statement apart from the
More than 500 people on Saturday marched in New York in support of Taiwan’s entry to the UN, significantly more people than previous years. The march, coinciding with the ongoing 79th session of the UN General Assembly, comes close on the heels of growing international discourse regarding the meaning of UN Resolution 2758. Resolution 2758, adopted by the UN General Assembly in 1971, recognizes the People’s Republic of China (PRC) as the “only lawful representative of China.” It resulted in the Republic of China (ROC) losing its seat at the UN to the PRC. Taiwan has since been excluded from