Kaloti Precious Metals-Morning Market Report-Friday, March 3, 2017

Market Daily & Weekly

Note: Indications only, open and closing prices are bids; Data source: Bloomberg; Times as per Dubai

Fundamentals and News

Gold, Copper Slip on Soaring Odds of U.S. Rate Hike This Month

Gold fell by the most in more than two months and industrial metals declined amid increasing odds the U.S. Federal Reserve will raise interest rates this month.

U.S. initial jobless claims fell to the lowest in almost 44 years, further bolstering the case for a rate hike, with Fed fund futures showing an 90% chance borrowing costs will rise, up from 80% a day earlier

Fed Governor Lael Brainard said Wednesday an interest-rate hike is likely appropriate “soon” as the country nears full employment and inflation moves toward the central bank’s target

“The reality that we’re this close to a highly likely rate increase is strengthening the dollar and putting pressure on metals, including copper and gold,” Bob Haberkorn, a senior market strategist at RJO Futures in Chicago, says in telephone interview

Gold futures for April delivery -1.4% to settle at $1,232.90/oz at 1:44 p.m. on Comex in N.Y., biggest loss for a most-active contract since Dec. 15

Copper futures for May delivery -1.7% to $2.6905/lb on the Comex, ending a four-day winning streak

NOTE: Fed Chair Janet Yellen and Vice Chairman Stanley Fischer due to speak Friday

The world’s gold miners will be running on the spot for years to come as a surge in gold prices prompts them to secure new production from less profitable projects, according to the largest mine streaming and royalty company.

“In my mind, the industry is ex-growth,” said David Harquail, chief executive officer of Franco-Nevada Corp.

After a downturn that squeezed capital investments, most gold producers have no choice but to invest in new projects as existing mines are depleted, Harquail said Wednesday in an interview. They’ll be faced with options that are, cumulatively, unlikely to boost global gold production or lower the sector’s overall costs.

“None of those projects are really great,” Harquail said at the BMO Capital Markets mining conference in Florida. “They would have been built by now if they were.”

Data Forthcoming Releases

Courtesy: http://kalotipm.com.sg/kaloti-market-report-3rd-march-2017