Markets:
- Gold up $57 to $5133
- WTI crude oil down 96-cents to $80.04
- AUD leads, USD lags
- Nikkei up 0.5%
- US 10-year yields down 1.2 bps to 4.14%
The US gave Iran a 30-day sanctions waiver to buy Russia crude in a move that’s seen as an indication that the US has a limited appetite to continue to push oil prices higher. China is also pressuring Iran to allow ships carrying its energy imports to pass through the Strait of Hormuz. Those headlines helped to push oil down but notably, it hasn’t stayed down. Brent fell as low as $83.16 but has steadily bounced to $84.47.
Despite that, the overall mood is improved. Stock markets in Korea and Japan opened more than 1% lower but are now trading solidly higher. In FX, that’s translated into broad but modest US dollar selling.
Trump also indicated that Iran is looking to negotiate. He said it wasn’t the time for that but it’s a sign that Iran doesn’t want to fight, and if that’s the case then something will be negotiated in the 4-5 week timeframe that Trump set out.
Gold has been bid up every day this week in Asia and that continued today. It’s up more than 1% and silver is up nearly 3% as precious metals shine in the session. Note though that gold is down on the week as Europe and the US have overwhelmed Asian buying with sales.
Expect a tentative finish to what has been a dramatic week.
