View: Still prefer Gold over balance of commodity complex, specifically Oil
Markets have been gearing up all summer for another dose of stimulus from the Federal Reserve and increasingly, the prospect of hard action from the ECB to prop up peripheral debtors, which although sterilised would still fit under the umbrella of looser monetary policy. Equities went early and have been range trading near the highs for the year as they await these decisions but other doors have opened with Gold breaking out of its long held trading range on August 21st to take run back towards the $1,700 level and commodities more generally have continued to edge higher, evident in the rise in the CRB and GSCI indices. Of course not all of this appreciation has been driven by expectations of more central bank printing; soft commodities have pushed up on US drought conditions specifically and oil prices continue to draw a bid from fears over Israel’s willingness to strike Iran’s nuclear programme not to mention the Syria situation which by itself is irrelevant for oil but nonetheless reminds on how divided the Middle East is (Syria in many ways now looks like a Saudi/Iran proxy war).
Full report below…
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