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Palladium declines 2%, heads for $1000 an ounce
Palladium prices fell on Tuesday as the dollar rose against most major rivals, with the metal approaching $1000 an ounce.
Palladium lost most of its value in the past few months away from a record of $3000 scaled after the Russian-Ukrainian war broke out.
Palladium is used heavily in the electronics and automotive industries for its benefits in cutting down exhausts.
High-risk asset such as stocks and commodities were highly pressured as US 10-year treasury yields spiked 16-year highs on speculation US monetary policy will remain tight for an extended duration.
Now investors await the crucial US payrolls report next Friday to gather clues on the likely path ahead for the Federal Reserve.
Otherwise, the dollar index rose 0.2% as of 16:09 GMT to 107.08, with a session-high at 107.3.
Palladium December futures fell 1.9% as of 16:10 GMT to $1183 an ounce.
Oil prices sharpen decline to three-week trough as dollar powers up
Global Oil prices fell in European trade, sharpening losses for the fourth straight day with US crude plumbing three-week lows while Brent hit four-week lows as dollar strengthens.
Prices are also pressured by growing concerns about US demand as the Federal Reserve announced plans to keep interest rates high for an extended duration to arrest inflation.
Global Oil Prices
US crude fell 0.9% to $87.81 a barrel, the lowest since September 12, while Brent declined 0.8% to $89.60 a barrel, the lowest since September 8.
US crude lost 2.3% on Monday, while Brent slid 1.8%, the third loss in a row on risk aversion.
The Index
The dollar index rose 0.2% on Tuesday, on track for the third profit in a row, hitting an 11-month high at 107.21 against a basket of major rivals.
A stronger dollar weighs on dollar-denominated commodities and they become costlier to holders of other currencies.
US 10-year treasury yields surged to 16-year highs as the US government shunned another shutdown, in turn boosting dollar's standing.
US Rates
Michelle Bowman, a known bull in the Federal Reserve, has expressed her desire for more interest rate hikes.
New York Fed President John Williams said on Friday that interest rates should remain high for some time.
US Stocks
Later today, initial data on US crude stocks will be released by the American Petroleum Institute, expected to show an increase for the second week in a row.
Dollar extends gains to 11-month peak amid strong demand
Dollar rose in European trade on Tuesday against a basket of major rivals, extending gains for the third session and scaling an 11-month high on strong demand, as US treasury yields rally.
Recent strong US data and bullish remarks by Fed officials boosted the case for a 0.25% interest rate hike before the year end.
The Index
The dollar index rose 0.2% to 107.21, the highest since November 2022, after closing up 0.8% on Monday, the second profit in a row following strong US manufacturing data.
US Yields
US 10-year treasury yields climbed 0.5% on track for the second session, scaling a 16-year peak at 4.743%, bolstering investments in the dollar.
Recently the US government managed to avoid another partial shutdown, in turn hurting demand on US bonds and boosting yields.
Strong Data
US services data showed the vital sector is slowing approaching a recovery as demand improves.
Such data showcases the strength and flexibility of the US economy despite higher US interest rates.
Such data bolstered the case for another 0.25% Fed interest rate hike at either the October or December policy meetings.
Aggressive Remarks
Federal Reserve official Michelle Bowman said the time is likely appropriate for another interest rate hike before maintaining rates at high levels for some time,
Cleveland Fed President Loretta Mister said the Fed will likely need to raise interest rates once more this year to bring inflation back to 2%.
Fed Rates
Current pricing for a 0.25% interest rate hike in November stands at 26%, while pricing for a December rate hike stands at 45%.
Fresh Data
To gather more clues on the likely path ahead for US policies, new data on job opportunities will be released later today, expected to show the availability of 8.81 million jobs in August.
Gold plumbs seven-month trough under pressure from dollar, US yields
Gold prices fell in European trade for the seventh straight session, plumbing seven-month lows and on track to drop below $1,800 under pressure from the dollar.
US dollar scaled an 11-month peak against a basket of major rivals, while US 10-year treasury yields hit a fresh 16-year peak following strong US data and bullish remarks by Fed officials.
Gold Prices Today
Gold prices fell 0.7% to $1,815 an ounce, the lowest since March, after losing 1.15% on Monday, the sixth loss in a row, and the longest such streak of losses since 2023, following a spate of upbeat US data.
The Dollar
The dollar index rose 0.2% on Tuesday, extending gains for the third straight session and scaling an 11-month high at 107.21 against a basket of major rivals.
A stronger dollar weighs on dollar-denominated gold futures as they become costlier to holders of other currencies.
US Yields
US 10-year treasury yields spiked 0.5% today, scaling a 16-year high at 4.704%, pressuring non-yielding assets.
Recently the US government managed to avoid another partial shutdown, in turn hurting demand on US bonds and boosting yields.
Strong Data
US services data showed the vital sector is slowing approaching a recovery as demand improves.
Such data showcases the strength and flexibility of the US economy despite higher US interest rates.
Such data bolstered the case for another 0.25% Fed interest rate hike at either the October or December policy meetings.
Aggressive Remarks
Federal Reserve official Michelle Bowman said the time is likely appropriate for another interest rate hike before maintaining rates at high levels for some time,
Cleveland Fed President Loretta Mister said the Fed will likely need to raise interest rates once more this year to bring inflation back to 2%.
Fed Rates
Current pricing for a 0.25% interest rate hike in November stands at 26%, while pricing for a December rate hike stands at 45%.
The SPDR
Gold holdings at the SPDR Gold Trust rose 1.44 tonnes yesterday to a total of 875.08 tonnes, the highest in a week.