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On April 3, Andrzej Skiba, head of BlueBays U.S. fixed income department at Royal Bank of Canada Global Asset Management, said that despite the negative impact of tariffs on economic growth, a U.S. recession has not yet occurred. The asset management company expects U.S. economic growth to slow to 1.5%, but does not expect a recession or two consecutive quarters of GDP decline. Skiba said: "This time, the Fed did not raise interest rates aggressively amid a slowing economy; the worst case scenario is that the Fed maintains higher interest rates for longer instead of raising interest rates."HSBC: Raised its gold price forecast for 2025 to $3,015/oz (previously $2,687/oz), and raised its forecast for 2026 to $2,915/oz (previously $2,615/oz).Frances CAC40 index widened its intraday losses to 3%, Germanys DAX index fell 2.3%, and Britains FTSE 100 index fell 1.58%.On April 3, after Trump announced the imposition of comprehensive import tariffs, gold prices soared to a record high on Thursday, but quickly fell back as some traders took profits, falling more than $80 from the intraday high, down 1.3% on the day. But most analysts are still optimistic about gold. Adrian Ash, head of research at Bullion Vault, said: "Weaker trade, rising input costs and shrinking profit margins have severely damaged the stock market, while geopolitical distrust is deepening. Such a bleak outlook for economic growth provides a perfect backdrop for further increases in gold prices." Analysts at ANZ Bank said that gold prices will approach $3,200 in the next six months.The iTraxx European Cross Index widened to 340 basis points, the widest level since August 2024, according to S&P Global Market Intelligence data.

WTI Remains on the Defensive Near $76, as Central Banks Rekindle Recession Fears and PMIs Are Monitored

Daniel Rogers

Dec 16, 2022 11:48

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Following a reversal from the weekly high to welcome the bears, WTI crude oil licks its wounds near $76.20 on Friday morning. Fearing a recession, the traders of black gold are awaiting the first readings of important economic activity figures from leading economies.

 

In spite of this, the energy benchmark fell the most in over a week as global central banks announced rate increases the day before. The oil market's pessimism was exacerbated by the policymakers' willingness to maintain high interest rates for an extended period of time, as well as inflationary concerns. Consequently, economic slowdown worries bolstered the US Dollar's safe-haven demand and weighed on the Oil.

 

Moreover, owing to Beijing's prominence as one of the world's largest consumers of commodities, weak China statistics provided additional support to sellers of black gold. China's Retail Sales dropped to -5.9% in November, compared to -3.6% predicted and -0.5% previously, while Industrial Production came in at 2.2%, compared to 3.3% market predictions and 5.0% earlier readings.

 

In addition, news from Canada weighed on oil prices, as reported by Reuters: "Canada's TC Energy Corporation said it was resuming operations in a stretch of its Keystone pipeline, a week after a spill of more than 14,000 barrels of oil in Kansas caused a shutdown."

 

As a result, oil bears are well-positioned to reclaim control, but await the early readings of the PMIs for the UK, Europe, and the US for the month of December for unambiguous guidance.


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