Oil jumps as IEA confirms tight market conditions
Oil prices are rallying once more as the IEA raised forecasts for demand this year and confirmed that OPEC+ missed its output targets again in January and by an even wider margin of 900,000 barrels. The group acknowledged that the market is tight right now while highlighting that a nuclear deal between the US and Iran could release 1.3 million barrels of supply. There was also a nod to Saudi Arabia, where available spare capacity is apparently concentrated. Not that the White House is having any luck convincing them to unleash it.
Gold slips after inflation data
A jump in yields on Thursday on the back of the inflation data stopped gold from recording the eighth day of gains in nine. The yellow metal gave up initial gains to end the day a little lower as markets priced in a sixth hike this year in the US and yields elsewhere also rose.
Gold has remained a favourite recently even as rate hike expectations have increased, probably benefiting from its inflation hedge reputation, but there’s surely going to come a point when so many hikes are priced in that it will lose some appeal. That’s not to say it will suddenly tumble but gains may become limited, as we’ve seen in recent months around these levels.
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