Written Commentary
GOLD / SILVER
A preliminary report out of Israel suggesting that fully vaccinated individuals are protected against the Omicron variant lent support to equities and several commodity markets overnight, including the metals. Clearly, gold, silver, platinum, and palladium are tracking classic physical commodity supply and demand factors, as prices fell yesterday in the face of a flight to quality condition. However, the markets were also undermined by hawkish comments from the US Federal Reserve Chairman regarding the Fed’s need to pivot toward tightening before inflation becomes an issue.
PLATINUM
Platinum and palladium also saw some support overnight on the positive vaccine news from Israel and the generally supportive tone in equities and commodities, but this was after some aggressive liquidation on Tuesday. Both markets have been tracking classic commodity market fundamentals as opposed to garnering support from flight to quality.
COPPER
Copper held within a relatively tight inside-day range overnight, but they its posting gains coming into this morning’s action. The “risk on” mood across global markets has offset any pressure from the Caixin Chinese manufacturing PMI number, which was back below the key 50 level. Surprisingly, the market avoided the significant liquidation that was seen in many physical commodity markets yesterday.
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