It was reported on 14 January 2014 that the prices at the West Texas Intermediate energy market appeared to be in a state of flux following recent speculation over the current levels of supply in the United States. At last check, prices of futures for February were falling as traders voiced concerns that the pace of demand would begin to fall after a government issued report sparked indications that the US stockpiles were indeed higher than many experts had previously believed.
Analysts remind readers that the US is the world’s largest consumer of oil. As such, American demand can often weigh heavily on the global prices, despite the influence of increased purchases from some of the developing powers such as India and China. Experts have noted that there are currently higher levels of finished oil products such as gasoline and heating oil already in the US, which they say is helping to depress prices.
Traders are advised to watch the price of oil carefully in the coming days as the speculation over supplies are likely to fuel continued volatility.
Questions Raised Over Gold in New Year
Commodity experts were reported on 14 January 2014 to have been in heated discussions over the future of gold as we enter the new year. Following the massive losses that were experienced during 2013, many investors appear skittish on the precious metal. However, some traders are said to be returning to gold at the start of 2014, boosting prices back up.
Analysts note that some experts have expressed that they see this rally as most likely short lived. As such analysts believe that this spike in prices is likely a reaction to the extreme suppression towards the end of 2013 as investors attempt to recover from the severe beating that it received from the market. Moreover the market continues to digest the new effects of the tapering by the Federal Reserve that helped to return investors to the USD after many had fled to gold during the recession.That said, there appear to be some signs of hope for the precious metal. Demand for gold appears to remain strong out of China. For its part,while the future of India's gold buying is more in question, they are still buying at this time.
While on the whole, experts believe that the price of gold will likely rise over the course of this year, analysts assess that the price will fluctuate considerably in the coming weeks. As such, traders are advised to approach with caution.
US Dollar Breaks Down Streak
The US dollar was reported on 14 January 2014 to have escaped a three day decline in trading against its rival currencies. The return to grace follows the jobs report for December 2013 which was issued last week. According to the figures in the report, the number of jobs added fell far below expectations, especially in comparison with the numbers seen in November. It should be noted that the high number of jobs added to the workforce in November is believed to have played a role in convincing the Federal Reserve to begin tapering off its stimulus package, bringing it down by $10 billion.
Analysts point to the opinions expressed by many experts who have stated that while the American economy appears to be strong, it is still adjusting to the changes coming out of the Fed. Analysts also note that America’s neighbor to the north also appears to be struggling at the moment with the loonie reportedly falling to the lowest level in over four years. For its part, the Yen also fell significantly after a report showed a widening deficit brought on by its asset purchases.
Traders are advised to watch all of these currencies closely in the coming days. Additional shifts can be expected should the Advanced Retail Sales show a significant reduction in growth.