Commodities: Oil, Gold Higher Ahead of Fed Meeting

Commodities: Oil, Gold Higher Ahead of Fed Meeting


Commodities are getting a boost today, climbing as the dollar slips in value against the euro ahead of this afternoon's Federal Reserve meeting. Oil is up $0.26 to $88.87 a barrel, reversing yesterday's fall, while the most active February gold contract pressed back above $1,400 an ounce, climbing $8.10 to $1,405.40 an ounce.

Copper also is higher, with the March contract up fractionally from Monday's settlement to 4.21 a pound, after earlier hitting a record $4.2290 yesterday.

A new Goldman Sachs research report yesterday provided precious metals with added momentum, predicting gold will reach $1,690 an ounce by the end of 2011 and peak sometime during 2012.

"We expect a low U.S. real interest rate environment will continue in 2011, particularly given the resumption of quantitative easing measures in the U.S., and expect gold prices to continue to climb" into next year, Goldman analysts said in the report. Gold will peak in 2012, they said.

Gold is up over 28 percent this year, the 10th straight year the metal will post an annual advance.

Oil, paced by heating-oil futures, fell on Monday as a recent cold snap in several parts of the U.S. appeared to be less severe than initially feared. Gasoline inventories, due out tomorrow, also were predicted to climb for a fourth consective week, according to a survey of analysts by Bloomberg.

In company news, Spartech Corp. (SEH) reported a Q4 net loss of $1.78 a share on a 7% jump in revenues to $259.6 million. The higher sales reflected a small increase in volume and the effect of higher prices due to higher raw material costs, including oil, according to the producer of plastic sheeting and other packaging items.

Reuters also is reporting today that Kazakhstan plans to invite either Rio Tinto (RIO) or Vale (VALE) to develop a large copper deposit in the center of the country, quoting a senior government official. The deposit also contains gold and silver.

Will Commodities Surge Continue?

Thurs. Oct. 14 2010 | 11:00 AM ET
Discussing inflation in the commodities sector, with Michael Pento, Euro Pacific Capital, and Dennis Wassung, Cabot Money Mgmt.

Gold vs Crude Oil

What is Moving Gold and the Precious Metals?

George Gero of RBC Wealth Management offers a snapshot of the commodities market.

Rebound in Gold and Silver Prices

as central banks and particularly the American federal reserve the FED continues to flood the market with US dollar notes freshly printed out of thin air , investors fearing hyperinflation like Zimbabwe ex Yugoslavia Argentina or Weimar way have been and will continue to invest in Gold Silver commodities and other precious metals ....Gold prices have been rebounding as central banks around the world print more money, with Jim Grant, CNBC