Fed: Rate call eyed for commodity direction – ABN AMRO


In view of analysts at ABN AMRO, expectations about Fed rate cuts proved to be supportive for alternative investments like US dollar-denominated commodities.

Key Quotes

“As we expect a lower probability for a larger than 25bp rate cut than the market is pricing in, there is a risk of disappointment in commodity markets. This may result in some profit taking on the longs and thus add some pressure later this month if the Fed cuts by ‘only’ 25bp.”

“On top of that, the lingering trade dispute between US and China continues to cap upside potential. As a result, the CRB-Index continued to trade within the 180-195 range (currently at 187).”

Commodity price outlook

  • For most commodities, we expect sideway trading to continue in the coming months. Oil prices are range bound (Brent $60-80/bbl, WTI $50-70/bbl) while base metals and tropical commodities also show a mixed picture.
  • Downside risks emerge for gold as the rally may have run out of steam.”

“All-in-all, we remain neutral on commodity prices this year but see upside potential in 2020.”

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility.

Feed news

Latest Forex News

Editors’ Picks

EUR/USD pulls away from two-week highs, steadies near mid-1.10s

EUR/USD lost its momentum before testing 1.11 as surging US Treasury bond yields and upbeat macroeconomic data from the US helped USD gather strength.

EUR/USD News

GBP/USD fails to hold above 1.29 on broad USD recovery

GBP/USD erased more than 70 pips in American trading hours and turned red below 1.2900 pressured by the broad-based USD strength that saw the US Dollar Index rebound to 98.

GBP/USD News

USD/JPY edges higher toward 108.70 as 10-year T-bond yield extends rally

The USD/JPY pair rose modestly in the last hour boosted by the improving market sentiment and was last seen trading at 108.65, adding 0.05% on a daily basis.

USD/JPY News

Gold: Remains vulnerable below 100-day SMA

Gold seems to have stalled its recent corrective bounce from three-month lows and witnessed a modest pullback from previous support, now turned resistance near 100-day SMA.

Gold News

Slow-motion Bitcoin battering continues amid interesting Tron chart, Pomp's PayPal comment

Bitcoin plunges below $8,00, dragging cryptos down. Thursday's trading is marked by a sea of red, without a single downward driver, but with an accumulation of downbeat developments. 

Read more

Forex MAJORS

Cryptocurrencies

Signatures