US stocks gained ground in a broad-based rally after the Fed’s Powell said that US economic recovery is not strong enough to pull back stimulus support, adding that the central bank is ready to intervene if inflation spiralled out of control, and believes inflation will remain high in the coming months before moderating. US PPI rose by more than expected in June, indicating further pressures on manufacturers to pass higher costs down to consumers. The dollar and the 10yr US Treasury yield both weakened on the day. The pound strengthened as the UK CPI accelerated by 2.6% y/y in June, above expectations. Yellen and Powell are scheduled to meet this Friday to discuss the risks of the hot housing market.
Metals prices were weaker today due to the Fed’s statement, apart from tin that closed on the front foot at $32,661/t. Copper prices softened to test appetite below $9,350/t, triggering a close at $9,342.50/t. Aluminium was also down on the day, closing at the day’s lows at $2,525/t; cash to 3-month spread widened out to -$17.69/t. Nickel remained under pressure, closing at $18,581/t. Zinc tested the $2,910/t level and closed higher at $2,925.50/t.
Oil futures declined from 18-months highs after the UAE reached a preliminary deal to resolve the OPEC+ supply conflict. WTI and Brent sold off to $74.03/bl and $75.61/bl. Precious metals were mostly higher, with gold and silver edging up to $1,822.79/oz and $26.11/oz.
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All price data is from 14.07.2021 as of 17:30