The Weekly Dig
Haywood Mining Team
U.S. Retail Sales Boost Dollar Sending Base Metals Prices Lower
§ Better-then-expected retail sales data from the U.S. together with increased consumer confidence heightened the prospects of an interest rate hike later this year, thus sending the dollar up for the second straight week; the U.S. dollar hit a two-week high against a basket of currencies, resulting in the greenback’s best fortnightly performance since February. The strengthening dollar has weighed heavily on base metal prices, eroding most of the gains from late March which saw copper in particular peak at $2.32 per pound during intra-day trading on March 18, although prices still remain above the $1.94 per pound low the red metal hit in late January. Base metals have also been affected by rampant speculation in Chinese commodity markets, which sent the price of iron ore with 62% Fe content delivered to China north of $70 per tonne last month despite fundamentals suggesting continued oversupply; iron ore delivered to Quingdao fell 0.9% to $54.54 per tonne on Friday, while copper (↓4.2%), nickel (↓5%), lead (↓2.7%) and zinc (↓0.2%) each finished at $2.07, $3.90, $0.77 and $0.85 per pound respectively. The appreciating U.S. dollar also saw precious metals down during the week, with gold in particular hitting a low of $1,263 per ounce during the week before recovering to finish at $1,275; silver (↓2.2%), platinum (↓2.9%) and palladium (↓2.8%) all ended the week at $17.09, $1,050 and $591 per ounce respectively. WTI crude pierced the $46 per barrel level following lower production level exacerbated by the wildfires in Alberta this week, finishing at $46.13. Finally, the UxC Weekly Spot Price of uranium pierced the $28 per pound level, finishing at $28.06 per pound.
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