Precious metals less attractive?
The strong selling force caused the red color to dominate on the metal price list yesterday. Precious metals could no longer maintain their upward momentum with gold falling 0.8% to $1,921.4 per ounce, silver closing 1.6% lower and losing the $25 mark. Platinum fell nearly 2% to $1,025.1 an ounce.
Money flow left the safe-haven markets, in the context that investors were no longer too worried about the US Federal Reserve (Fed) raising interest rates more “aggressively”. The CME Watch Tool is also showing that there is a 72% chance that the Fed will raise interest rates by 0.5% at the upcoming meeting in May in response to inflation.
Investors are now prioritizing investing in risky markets such as the stock market and the cryptocurrency market, because the Fed’s actions to curb inflation have improved sentiment, and have not affected growth expectations of the US economy. This puts a lot of pressure on the prices of precious metals.
In addition, the 10-year US government bond yield, which is at the highest level within 3 years, will also be an indirect “resistance” to purchasing power in the precious metal market, because cash flow can be move to bonds instead of gold, silver or platinum.
Nickel fell more than 10%, copper and iron ore were also in the red
For the group of base metals, copper price continued to decrease 0.2% to 4.7 USD/lb. Although the decrease was somewhat modest, the fact that the copper price fluctuated strongly yesterday, there was a time when the price touched 4.77 USD, in the context of the International Organization for Research on Copper (ICSG) said that the copper market has may have a deficit of 475,000 tons this year, as output in the world’s two largest producers, Chile and Peru, declines.
However, the price closed in the red, because despite the supply deficit, the demand for copper has not increased strongly because of the general difficulties of the global economy.
Notably, nickel price continued to drop sharply by more than 10% to $28,159/ton. Investors continued to “escape” from the nickel market after the recent extreme ups and downs. Currently, the price has dropped nearly 50% from the peak, and there is still no sign of stopping.
Iron ore prices also fell more than 3% to $145.6 per pound as steelmaking activities in China are likely to continue to be restricted to reduce air pollution. The country’s Ministry of Ecology and Environment announced that the second ecological and environmental inspection has officially started. Even so, it is still early to confirm that iron prices have reversed.
The sharp increase in the price of iron ore and other raw materials such as coal and scrap steel has pushed up domestic steel prices continuously in recent years. Currently, the price of construction steel has exceeded 19 million VND/ton, nearly 1 million VND higher than the peak in 2021.
Commodity Exchange of Vietnam (MXV)
T&G International Joint Stock Company
Address: 352 Hue Street, Le Dai Hanh Ward, Hai Ba Trung District, Hanoi
Hotline: 0345786803
Email: hrm@tginterjsc.com
Website: http://tginternationaljsc.com
