Oil stabilizes as we await more Omicron data
Oil prices appear to have stabilized over the last week after roaring back from their Omicron-induced losses. OPEC+ put a floor under the price for now as the group warned of sudden adjustments in output but ultimately, the price will only hold up as long as investors continue to believe Omicron poses no substantial threat. Leaders appear more concerned than investors at the moment which is always a worry, but with oil prices 15% off their October highs, there does appear to be some caution priced in at these levels.
Gold range-bound ahead of the Fed
Gold is seeing some support for a second day but remains below USD1,800 and within the range it’s traded broadly within over the last few weeks. If it can break above USD 1,810 it may pick up some momentum to the upside but I struggle to see that ahead of the Fed decision on Wednesday. Then it’s a question of what gold bulls will want to see from the meeting. No taper acceleration? Pushback against rate hikes? Transitory being brought out of retirement? I’m not sure we’ll see any of these.
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