Palladium declines under pressure from dollar and US inflation assessment
Palladium prices declined on Friday as the dollar gained ground against major rivals while markets assess latest US inflation data.
Government data showed US producer prices rose 0.3% in July m/m, above estimates of 0.2%.
Prices rose 0.8% y/y in July, after a 0.2% rise in June.
Core producer prices rose 0.3%, surpassing estimates of 0.2%.
Earlier data showed US consumer prices rose 3.2% y/y in July, below market estimates of 3.3%, and after a 3% increase in June, the slowest pace in 2-1/5 years.
Core consumer prices also slowed down to 4.7% in July from 4.8% in June, the fourth monthly drop in a row.
Such data mostly paves the way for no change in US monetary policies at the US Fed policy meeting in September.
The Fed raised interest rates to 22 year highs in recent months in an efforts to control inflation and calm the markets.
The dollar was up 0.2% as of 15:12 GMT to 102.7, with a session-high at 102.8, and a low at 102.4.
On trading, palladium September futures fell 0.7% as of 15:13 GMT to $1,296.5 an ounce.
Oil backs off nine-month high on US supplies
Oil prices fell in European trade on Friday for another session, with US crude off nine-month highs, while Brent slipped from a seven-month highs on active profit-taking.
Prices are also pressured by renewed concerns about US oversupplies, after commercial stocks rose past estimates, while US output also surged.
Global Oil Prices
US crude fell 0.6% to $82.27 a barrel, while Brent declined 0.5% to $85.88 a barrel, with a session-high at $87.05.
US crude lost 1.6% on Thursday, the first loss in three days, away from a nine-month high at $84.85 a barrel, while Brent declined 1.1% away from January highs at $88.05.
Oil prices surged this week after Saudi Arabia extended their voluntary cuts to the end of September, amounting to a million bpd, while Russia said it'll cut crude exports by 300 thousand bpd next month.
US Stocks
Official data from the Energy Information Administration showed US crude stocks rose 5.9 million barrels in the week ending August 4, surpassing estimates of a 2.1 million barrels buildup.
US Output
The EIA also reported an increase in US output by 400 thousand bpd last week, the largest such weekly increase since September 2021.
Total US output thus increased to 12.6 million barrels, the highest since March 2020.
Dollar heads for a new weekly profit
Dollar rose in American trade against a basket of major rivals for another session following strong US producer prices data in July.
The dollar is heading for a new weekly profit on prospects the Federal Reserve will raise interest rates once more this year.
The Index
The dollar index rose 0.15% to 102.75, with a session-low at 102.42, after rising 0.15% on Thursday, the third profit in a row, after bullish remarks by a Fed official.
San Francisco Fed President Mary Dale said there Fed still has work to do, the decision on future potential interest rates hikes hasn't been made yet.
Consumer Prices
US consumer prices rose 3.2% y/y in July, below market estimates of 3.3%, and after a 3% increase in June, the slowest pace in 2-1/5 years.
Core consumer prices also slowed down to 4.7% in July from 4.8% in June, the fourth monthly drop in a row.
Despite the data, markets are still betting the Fed might raise interest rates again in 2023, as core inflation remains fat from the 2% target.
Producer Prices
US producer prices rose 0.8% y/y in July, beating estimates, and after rising 0.2% in June, while core prices rose 2.8%.
Weekly Trading
The dollar index is up 0.75% so far this week on track for the fourth weekly profit in a row, the longest such streak of weekly gains since January.
Silver on track for fourth weekly loss in row
Silver prices rose in European trade on Friday on track for the second daily profit away from a five-week trough, while the dollar slows down.
The white metal is heading for the fourth weekly loss in a row on concerns about demand in China, the world's largest metals consumer.
Prices Today
Silver prices rose 0.45% to $22.80 an ounce, with a session-low at $22.66, after rising 0.2% on Thursday, the first profit in four days away from a five-week trough at $22.62.
The Dollar
The dollar index fell 0.2% on Friday against a basket of major rivals, in turn boosting dollar-denominated commodities such as silver.
Such a decline comes ahead of crucial US data later today, including producer prices for July, and the University of Michigan's economic confidence survey.
Weekly Trading
Silver is up 3.6% so far this week, on track for the fourth weekly loss in a row, the longest such streak of weekly losses since January.
Such heavy losses come amid concerns about declining demand in China and low investments in the non-yielding metal as US bond yields rally.
Chinese Demand
China marked the worst decline in its exports last month, since February 2020 according to official data.
US commodity sales in foreign markets also tumbled 14.5% in July, the third such monthly decline in a row.
The prospects of a potential recession in the US and Europe in turn hurt global demand on Chinese products in recent months.
The Chinese economy itself is still suffering the consequences of the long Covid 19 shutdowns.
Investment Demand
As dollar and US treasury yields rally, they attract investments away from silver and gold, with markets still speculating about another Fed rate hike this year.