On Thursday, the ECB’s decision to cut interest rates surprised the most of market participants and bolstered commodities prices across the board. Brent crude extended its morning gains after the decision came out and in late afternoon even flirted with 111 USD per barrel (USD/bbl) level.
Regarding trading today, eyes will be on the US payrolls report. We think the report will be weaker than expected. Moreover, event risk with regard to Greece and the EMU remains elevated. Therefore, we do not expect that there’s much room left for further gains in case of Brent oil.
Base Metals
Copper more or less tracked the US dollar on Thursday. Although the initial reaction on surprising cut in European interest rates was negative (as it supported the US dollar), copper eventually posted some gains and closed slightly above 7900 USD
per ton level (see the chart).
Precious Metals
Gold slightly eases today in early trading after it touched the highest price since mid September in previous session.
Interestingly, the price of the yellow metal little changed after the ECB’s decision. According to Reuters, activity in physical market in Asia remains subdued as price remained close to six weeks’ highs.
