Commodity Prices Surge As Fed Backs Away From Interest Rate Hike – What’s Next

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Published: Aug 30, 2021, 08:33 UTC

Commodity prices surged across the board with everything from the metals to energies notching up impressive gains after Fed Chair Jerome Powell signalled the central bank was in no rush to raise interest rates anytime soon.

Three glossy golden barrels of oil on a large pile of American dollars, the concept of high volatility of Brent, wti, urals grades in the commodity markets 3D rendering

In a virtual speech to the Jackson Hole Economic Symposium on Friday, Powell revealed that the U.S recovery appears to be making progress, but warned that ending stimulus measures too early would be damaging for the economy as a whole – especially as the highly contagious Delta variant of COVID continues to present a “near-term risk” to economic growth.

The commodity markets saw immediate gains following Powell’s speech.

The star performer was Crude Oil with Brent rallying 11% to post its biggest weekly gain since June 2020, while WTI surged 10% to post its strongest rise since August 2020.

The bullish momentum also split over into the metals with Gold prices soaring over $25 on the day to hit a 4-week high of $1820 an ounce. While Silver prices jumped almost 5% – racing back above $24 an ounce.

Elsewhere, the industrial metals skyrocketed to multi-year highs with Aluminium prices hit three year highs and Palladium prices soared 9% – to post their biggest one-day gain since May 2020.

Looking ahead to this week, the key market-moving events that traders will be watching closely include; U.S Non-Farm Payrolls Data, ISM Manufacturing PMI, ADP Employment Change and U.S Jobless Claims.

Where are prices heading next? Watch The Commodity Report now, for my latest price forecasts and predictions: