Yields, Oil Extend Declines
U.S. 10-year Treasury bond yields continued to reach new lows,
as yields made their largest weekly drop in nearly a year and a half.
Prices soared as investors feared that the U.S. economy was slowing due to the
pause in rate hikes. Investors sought safety in the long-term notes, which
sent prices to 6-month highs.
The Dollar fell against the euro this week the most since
June, as investors unloaded their positions in the dollar on fears that the Fed
will not raise rates again this year. Some investors are even speculating
that the Fed will cut rates before the year is out. The dollar regained
some lost ground against the yen, but global investor sentiment is set bearishly
against the dollar.
Crude oil futures fell 1.1% to close at $61.48 a barrel after
the President of Iran stated yesterday that the country is willing to discuss
suspending its nuclear program. Oil reached a record high of $78.40 over
the summer, as a war in Lebanon raged, North Korea tested multiple missiles and
the world prepared for a massive hit to the global oil supply. Oil has
been falling since the end of August, as tensions in the Middle East cooled and
investors realized that there were ample inventories to cover a possible supply
disruption.
Gold rose 1.3% to close at $591.48 an ounce, as a weakened
dollar sent investors scrambling for safe-haven futures. Demand in India
has also helped to maintain gold’s price, as the country leads the world in gold
consumption. Silver, copper and aluminum also rose, all up around 0.5%.
Softs mostly declined, with a few exceptions. Cocoa was
down nearly 2%, coffee rose nearly 1%, orange juice fell 2.6% and sugar fell
nearly 10%.
Grains mostly fell today. Corn was down 0.8%, wheat was
down 0.6%, and soy was down 1.5%; oats rose 1.2%.
Meats traded lower today, with cattle down 0.3% and
porkbellies down 0.6%.
A round of economic reports was released
today.
Check them
here.
John Patrick Lee