The oil price looks optimistic. What are the reasons?
Gold edges up on Fed policy
On Thursday, market participants took advantage of more confusion regarding Fed policy on rates and also took the precious commodity higher in Asia, following minutes issued overnight, which casts some doubt on a third lift in 2017.
December delivery gold futures headed north 0.80% in New York reaching $1,293.21 a troy ounce.
Fed minutes demonstrated a surging debate as for another rate lift in 2017. Additionally, the political backlash against Donald Trump's statement on a racist conflict in the USA applied pressure too.
The divide arose in minutes issued from the Fed’s July gathering, when the US key financial institution decided to hold the target rate within a range of 1%-1.25%. The summary pictures views that inflation will undoubtedly meet the Fed's 2% objective, though it’s clearly not there yet.
Overnight, the precious commodity turned positive, on the back of weaker American housing reports. Housing starts sank 4.8% hitting a seasonally adjusted annual rate of about 1.16 million units, as the Commerce Department informed on Wednesday.
USD’s rally takes a pause, while riskier assets are modestly rising.
We are now past the middle of January, and this means that the largest US companies will report their earnings for the fourth quarter and many of them will provide the results of the entire 2020.
Poor US data, slow vaccine distribution, rising virus cases worsened the market sentiment and underpinned safe-haven currencies like the USD, and JPY.