CL
Oil fell towards six-year lows on Monday, on data showing that the economy of Japan, the world's third biggest oil consumer, contracted in the second quarter. The global oversupply picture was exacerbated by another weekly jump in U.S. oil rig additions, hinting at growing production, and news that Oman produced a record-breaking 1 million barrels a day in July. Over the past two weeks, U.S. crude prices have fallen by more than 10 percent on U.S. supply concerns. Brent has fallen at a slower rate of around 4 percent. Production by the Organization of the Petroleum Exporting Countries is running well above demand filling stockpiles worldwide. Iran is expected to increase its oil exports once Western sanctions are lifted after ratification of a recent nuclear deal.
GOLD
Gold futures rose considerably in spite of a stronger dollar, as the People's Bank of China resumed its efforts to stabilize its currency nearly a week after it fell to its lowest level in more than three years. In Beijing, the People's Bank of China (PBOC) maintained its push to stabilize the yuan, days after its currency suffered its most tumultuous week in years. During Monday morning's daily fix, the PBOC moved its currency only 0.1% from its midpoint against the dollar, as USD/CNY rose modestly 0.06% to 6.3949. By comparison, the Chinese central bank moved the yuan nearly 2% below the midpoint of the currency pair on two consecutive days last week, as the remnibi fell to its lowest level in four years. Metal traders also await the release of the Federal Open Market Committee's minutes from its July meeting for further indications from the Federal Reserve later this week on the timing of a potential interest rate hike. While the Fed is expected to raise its benchmark for short-term interest rates before the end of the year, it has not indicated if it will do so during its September or December meeting.
