Oil falls 1.5% amid concerns about demand and the trade war
Oil prices fell on Monday amid concerns about the impact of the global trade war on oil demand, and especially in China and the US.
PVM analysts told Reuters that the trade war between the US and China still dominates investor sentiment and is still the biggest mover for oil prices.
He added that other factors, such as US-Iran nuclear talks and OPEC+ production plans are also impacting prices, but by a smaller degree than trade concerns.
Otherwise, Reuters reported that oil tankers are lining up near an old port in western Venezuela to load shipments before the expiry of the US shipping license to local and international companies by the end of May.
On trading, Brent July futures fell 1.5%, or $1.01 to $65.86 a barrel.
US crude futures due in June fell 1.54%, or 97 cents to $62.05 a barrel.
Ripple climbs 2% on renewed demand on cryptocurrencies
Ripple rose on Monday alongside most cryptocurrencies as the trade war concerns receded following positive remarks from Chinese and US officials.
US Treasury Secretary Scott Bessent called on China to calm trade tensions, and said the responsibility falls on China for reaching a trade deal.
Bessent said in a CNBC interview that China should move to calm the trade tensions as they sell to the US five times what the US sells to them.
He once again said the reciprocal tariffs between Washington and Beijing are not sustainable, pointing to the progress on trade negotiations between the Trump administration and many other countries, including India.
Trump admitted last week that current tariffs on India are too high, and won’t stay this way, and will decline but won’t reach zero.
He also calmed the markets by asserting that he doesn’t intend to sack Fed Chair Jerome Powell.
Ripple
On trading, ripple rose 1.9% as of 20:34 GMT to $2.29.
US dollar moves higher as the week opens up
The US dollar rose in European trade on Monday against a basket of major rivals, moving higher for the second straight session and about to scale multi-week highs amid a positive sentiment in the global financial markets with increasing signs about trade deals between the US and major trade partners.
Now markets await a batch of important US data later today, expected to provide important clues on the odds of a Fed rate cut in the first half of the year.
The Index
The dollar index rose 0.25% today to 99.84, with a session-low at 99.46.
On Friday, the index rose 0.3%, the third profit in four days, moving away from three-year lows at 97.92.
The index rallied 0.4% last week, the first weekly profit in five weeks on concerns about US recession and the independence of the Federal Reserve.
Reports indicated that China is considering tariff exemptions for some US products.
Chinese officials also asked the US to remove unilateral tariffs on China as a prerequisite for any trade negotiations.
Trump already stated that trade talks are currently ongoing with China, despite the latter’s assertions that no official talks are currently taking place.
US Rates
Several Fed officials recently signalled there’s no need to cut interest rates soon as the Fed continues to analyze new data to gauge the impact of US tariffs on the economy.
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut stand at only 9%, while the odds of such a cut in June stand at 63%.
Gold loses over 1.5% on slower haven demand
Gold prices lost over 1.5% in European trade on Monday, extending the losses for the second straight session and about to hit two-week lows under pressure from the stronger dollar.
Safe haven demand on the precious metal also slowed down as US-China trade tensions receded, while risk appetite improved around the world.
The Price
Gold prices fell 1.55% today to $3268 an ounce, with a session-high at $3331.
On Friday, gold lost 0.9%, the third loss in four days on profit-taking away from a record high at $3500.
The precious metal lost 0.25% last week, the first weekly loss in three weeks as haven demand wobbled.
US Dollar
The dollar index rose 0.25% on Monday, extending gains for the second straight session against a basket of major rivals.
A stronger dollar makes the greenback-denominated gold futures costlier to holders of other currencies.
The dollar’s latest rebound comes as concerns about a US recession receded with increasing positive signals about the global trade tensions.
Trade Developments
Reports indicated that China is considering tariff exemptions for some US products.
Chinese officials also asked the US to remove unilateral tariffs on China as a prerequisite for any trade negotiations.
Trump already stated that trade talks are currently ongoing with China, despite the latter’s assertions that no official talks are currently taking place.
US Rates
Several Fed officials recently signalled there’s no need to cut interest rates soon as the Fed continues to analyze new data to gauge the impact of US tariffs on the economy.
According to the Fedwatch tool, the odds of a 0.25% Fed interest rate cut stand at only 9%, while the odds of such a cut in June stand at 63%.
SPDR
Gold holdings at the SPDR Gold Trust fell 2.29 tons on Friday to a total of 946.27 tons, the lowest since April 9.