Close: London Session | Forex, Metals, Oil, Agriculture January 11, 2021



The Australian dollar (+1.91%), the New Zealand dollar (+1.38%), the Canadian dollar (+0.75%) and the British pound (+0.25%) posted gains against the US dollar. So far, the dollar and the financial markets moved in tandem – higher stocks and a lower dollar. The Australian dollar and New Zealand dollar have seen the steepest losses so far. In global markets, gold prices continued their slide amid a stronger dollar, a rise in US bond yields, and firm equities.
Higher bond yields increase the opportunity cost for holding the non-interest yielding bullion, while the stronger dollar makes the precious metal more expensive for investors using other currencies. Rising Treasury yields and expectations of an additional U.S. fiscal stimulus boosted the dollar, weighing on gold prices. Rise in U.S. Treasury yields and expectations of an additional fiscal stimulus from Washington boosted the U.S. dollar, while gold prices fell. The higher yields in the U.S. are starting to affect pricing and market participants were not prepared for the dollar’s upward trend.
One of the most striking news made headlines at the end of last week – all investment houses around the world see a weaker dollar in 2021. : The US dollar has been extending its gains alongside rising US bond yields.


On MCX, February gold futures fell 0.4% to Rs 48,760 per 10 grams, extending losses to Rs 2,350 in just two days. The Gold Analyst offers quality technical and fundamental analysis of the price of gold to help educate readers in their investment decisions. less Gold and silver prices fell by the most since late September, plunging as much as 5% and 10% respectively over two days. The Gold price failed to maintain a move higher above the descending channel which has been in place since early August, indicating weakness in the price above $1900.
Gold prices are trading up 0.3% at Rs 49,120 per 10 grams. In the previous session, gold had tumbled Rs 2,050 per 10 grams. But he believes that investors will still buy gold at dips since the interest rates remain very low and the coronavirus remains out of control. less Gold extended its losses from the previous sessions and plunged close to a six-week low earlier in today’s session. Fresh stimulus hopes may help to cushion the downside for gold and silver prices.
Other commodities including iron ore, copper and nickel suffered a pullback too, but not comparable to the extent that gold and silver suffered.


U.S. crude oil production has fallen 2 million barrels per day in the last year as low prices and demand forced shale producers to cut their losses. Saudi seaborne crude exports for last week were seen at 32.4 million bbl (4.6 million bpd) compared to the revised 43.5 million bbl (6.2 million bpd) the week prior. With most of the oil bullishness already priced in, oil prices are likely near their peak for now, restricting the upside for NOK in the short term.
Saudi Arabia, the world’s biggest oil exporter, surprised the market on Jan. 5 with a voluntary output cuts of 1 million barrels per day (bpd) in February and March. BEFORE THE BELL U.S. stock futures fell, along with world shares and oil prices, as investors feared a surge in coronavirus cases could delay an economic recovery. Resistance is seen near $1855.Note that the 200-day moving average is just shy of $1840.Crude oil prices are consolidating last week’s surge. This comes as China’s oil demand is soaring as it appears that China is way ahead of the rest of the world in recovering from the COVID-19 demand drop.
Weekly Iraqi crude exports went up 0.2 million bbl to 24.5 million bbl (3.5 million bpd).
Further upside in the oil price is probably very limited in the short term, and we don’t expect prices above $60/barrel before the summer. But we expect the NOK rally will stall when oil prices stop moving higher.

United States

Twitter shares slump after Trump account suspension Twitter’s German-listed shares slumped, the first trading day after it permanently suspended U.S. President Donald Trump’s account late on Friday. On the political front, House Speaker Nancy Pelosi (D., Calif) said the House may move to impeach President Trump as soon as this week. So far, markets are shrugging off the political drama in Washington, which is set to result in the second impeachment of outgoing President Donald Trump for inciting violence.
Political rancor remains front and center, as the House may move to impeach President Trump as soon as this week. Last week’s events are rippling through the US political landscape and likely will shape the future of the Republican Party, including its candidate for president in 2024. Plunge Shares in Twitter Inc. fell 7% in pre-market trading after the platform permanently banned President Trump’s account on the site. One of the reasons we expect the US cannabis industry to record strong growth in 2021 is related to the opening of new recreational markets.
Last week’s events paled in comparison despite the US President urging his supporters to march on Washington and demonstrate its strength. Wall Street forecasters were warning bondholders that the 10-year rate would likely hit 1.8% or higher with the anticipated economic growth surge in late 2021. If investors throw a 2013-style tantrum – when shares fell on the mere hint that the Fed would slow Treasury purchases – Powell may change his mind.


The Beijing-based internet firm, best known for its eponymous search engine, said it plans to establish a separate company that will make EVs. The order aims to stop U.S. investors’ money from supporting Beijing’s efforts to modernize its military.


less With national elections looming at the end of September and Angela Merkel not running for office, her party, the CDU, will choose a new leader this week. It may take a month or more to stabilize the situation and in the meantime sterling is certainly vulnerable to post Brexit deal selloff. Merkel had been party leader since April 2000 and has been German chancellor since November 2005. The central bank may soon intervene aggressively, to mitigate the impact from the third lockdown and Brexit disruption.
By now, I have built up excellent skills and experience in analyzing macroeconomic and political developments in Europe, the Eurozone and Germany, including ECB watching. The UK’s half victory over the Brexit deal has left the market hesitant to commit. Germany said the U.S. and the EU should scrap billions of dollars of tariffs on each other s exports levied in a dispute over subsidies to Boeing and Airbus. City of London’s plight laid bare as hopes for Brexit deal fade.
Later, ECB’s C.Lagarde will participate in a discussion panel at the One Planet Summit in Paris. All three have their own personal history with Angela Merkel.