According to Mining News Pro - In this week report we are going to talk about gold, copper and iron ore prices which all of them have fall to the lowest point.
Gold price extends losses, eyeing worst week since November
Gold extended declines on Friday, eyeing its worst week since late November, as growing expectations of US interest rate hikes pushed the dollar to a multi-month high.
Spot gold dropped 0.8% to $1,783.19 an ounce by noon EDT, the lowest since the first week of January. US gold futures fell 0.6% to $1,784.30 an ounce.
Gold prices slipped below its 100-day and 200-day moving averages in the last session, after the US Federal Reserve reaffirmed plans to end its pandemic-era bond purchases and signalled an interest rate hike in March.
“The current market environment has been very detrimental for gold. Investors are completely reassessing Fed expectations,” Edward Moya, senior market analyst at brokerage OANDA, told Reuters.
“There’s still some momentum selling in gold, but we’re getting closer to a potential bottom now that it has broken past $1,800,” Moya added.
Meanwhile, the rate hike expectations set the dollar on track for its biggest weekly rise in seven months, making gold more expensive for overseas buyers.
However, gold’s credentials as an inflation hedge is likely to attract renewed attention with rising stock market volatility amid a market adjusting to a rising interest rate environment, Saxo Bank analyst Ole Hansen wrote in a note.
Also likely to limit bullion’s decline was the World Gold Council’s forecast that demand for jewellery, small bars and coins would remain strong in 2022. It also expects central banks to continue buying gold but at a slower pace.
Copper price heads for biggest weekly fall in three months
Copper prices headed towards their biggest weekly decline since October on Friday as the prospect of central bank tightening reduced investor appetite for risky assets, hammering equities and boosting the dollar.
Europe’s main bourses fell again and Chinese equities slumped to 16-month closing lows while the dollar was at its strongest against a basket of major rivals since June 2020, making metals costlier for non-U.S. buyers.
March delivery contracts were exchanging hands for $4.31 a pound ($9,482 a tonne) on the Comex market in New York, down 2.5% compared to Thursday’s closing.
Benchmark copper on the London Metal Exchange (LME) was down 1.9% at $9,598 a tonne by 1201 GMT and down by about 3.5% this week.
Mining stocks also slid, with Freeport-McMoRan down 12.9% from the previous week, First Quantum Minerals down 12.6%, and Ivanhoe Mines down 10.8%.
“Price weakness could last through China’s New Year public holiday next week, typically a time of low demand,” said Saxo Bank analyst Ole Hansen.
“However, the longer-term outlook remains positive, with a global transition from fossil fuels to copper-intensive electrification likely to boost demand.”
Iron ore price hits 5-month high on China demand optimism
Iron ore price jumped on Friday, buoyed by a combination of hopes that China’s stepped-up monetary easing would stimulate demand and fears over tight supply prospects.
According to Fastmarkets MB, benchmark 62% Fe fines imported into Northern China were changing hands for $147.42 a tonne during morning trading, up 5.7% compared to Thursday’s closing.
The steelmaking ingredient’s most-traded May contract on China’s Dalian Commodity Exchange ended daytime session 7.6% higher at 829 yuan a tonne, after earlier touching 830 yuan, its strongest since Aug. 31.
Front-month March iron ore on the Singapore Exchange leapt as much as 7% to hit a contract high of $147.25 a tonne.
Spot prices also rebounded strongly, with the benchmark 62%-grade material climbing to $140 a tonne on Thursday, the loftiest since Sept. 3, according to SteelHome consultancy data.
China’s output is expected to rise in the first half of 2022, before declining in the second half, S&P Global Platts reported citing industry sources and market participants.
Despite China’s ambitious low-carbon goals, President Xi Jinping has said “reducing emissions is not about reducing productivity, and it is not about not emitting at all.”
“This has once again ignited hopes for a revival in raw material demand, which would be more visible post-February,” after the Beijing Winter Olympics, ING commodities strategists said in a note.
Warnings by major miners Fortescue Metals Group, BHP Group and Rio Tinto of coronavirus-led labour shortages in Australia added fuel to iron ore’s rally.