Gold prices hit a seven-week high on Friday due to a soft dollar and rising safe-haven demand.
Meanwhile, silver continued to hit record highs as the price inched up to $64 per ounce for the first time ever.
Oil prices were largely flat after spending most of the day in the red on concerns over a supply glut and a potential Russia-Ukraine peace deal.
Copper prices have continued their record-breaking ascent.
Following the Federal Reserve’s interest rate cut, the price saw a significant rise on Thursday, reaching nearly $12,000 per ton this morning.
This new high puts the current price of copper 36% above where it stood at the start of the year.
“The main driver is concern that supply will not be able to keep pace with rising demand,” Barbara Lambrecht, commodity analyst at Commerzbank AG, said.
Gold surges
Gold’s price surged back past $4,300 per ounce on Friday.
This level was last seen less than two months ago when the precious metal achieved its most recent record high.
Gold became more affordable for international buyers as the dollar, tracking a potential third consecutive weekly decline, hovered near a two-month low.
US jobless claims saw their largest increase in nearly four-and-a-half years last week, completely offsetting the substantial decline recorded the week before.
The US Federal Reserve enacted a third 25-basis-point rate cut this year on Wednesday, while simultaneously signalling a cautious approach toward any further reductions.
Markets are currently anticipating two rate cuts next year. The upcoming US non-farm payrolls report, scheduled for next week, is expected to offer additional insight into the Fed’s future policy direction.
“Although there are signs of a pause at the next meeting in January, the door remains open for further interest rate cuts after that,” Carsten Fritsch, commodity analyst at Commerzbank, said.
We expect more significant interest rate cuts than the market, especially after Powell’s successor as Fed chair takes office in May.
At the time of writing, the COMEX gold contract was at $4,372 per ounce, up 1.4% from the previous close.
Silver races to record high
Silver prices are currently soaring, having hit a new record high of $64.953 per ounce on Friday.
This record price reflects a significant gain of 10% just this week, and an overall increase of 27% over the last three weeks.
“The increase since the beginning of the year now stands at 120%. This means that silver is on track for its strongest annual gain since 1979,” Fritsch said.
The gold/silver ratio fell below 67 yesterday, its lowest level since June 2021, putting it only slightly above the average for the past 50 years.
Tense market conditions are driving this rise, characterised by low inventories in China and a reduction in silver inventories on the COMEX, despite COMEX inventories remaining higher than they were at the start of the year.
“But the daily MACD is now extremely overbought. While I could always be mistaken, I’ve checked my charts and can’t find a time when it has been this overbought before, stretching all the way back to the bull market which ended in April 2011,” said David Morrison, senior market analyst at Trade Nation.
At the time of writing, the March silver contract on COMEX was at $64.605 per ounce, slightly higher.
Oil steady
Oil prices were heading for a weekly drop after slipping further on Friday.
Investor attention was fixed on a supply surplus and the possibility of a Russia-Ukraine peace agreement, alongside worries about potential disruptions to Venezuelan oil supply.
According to Janiv Shah, an analyst at Rystad Energy, factors such as escalating tensions between the US and Venezuela, as well as Ukrainian drone strikes targeting a Russian oil rig in the Caspian Sea, are continuing to support oil prices.
The US is reportedly readying to seize more vessels carrying Venezuelan oil, following the interception of a tanker earlier this week, according to six sources familiar with the situation on Thursday.
Separately, Russian seaborne exports of oil products saw a slight decline of only 0.8% in November compared to October.
This minimal drop occurred despite a reduction in fuel exports from southern channels like the Black Sea and Azov Sea, as maintenance work at refineries concluded, offsetting the slump, data from industry sources and Reuters calculations indicate.
Market uncertainties have led to significant losses for the Brent and WTI benchmarks this week, with both dropping over 4% so far.
At the time of writing, the price of West Texas Intermediate crude oil was at $57.65 per barrel, largely flat from the previous close, while Brent was at $61.25 per barrel, also flat.
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