The prices of commodities mostly fell this week, despite Friday’s data showing stronger-than-expected Q1 growth in the US. Even oil prices ended this week lower. Having initially jumped when the US government announced its decision to remove waivers from sanctions on purchases of Iranian oil, they later dropped back following reports that President Trump was putting pressure on OPEC to raise supply. Given the scale of supply disruption so far this year, we have revised up our end-2019 forecast for the price of Brent to $60 per barrel ($50 previously).
Next week will be busy on the data front, especially in the US, with the conclusion of the Fed’s policy meeting (Wednesday) and the employment report (Friday). We anticipate little change to Fed policy but the prices of precious metals could receive a small boost if, as we expect, jobs growth comes in weaker-than-expected. Elsewhere, we forecast somewhat weaker Chinese manufacturing PMI readings for April which could weigh on industrial metals and oil prices later in the week.
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