Commodity Market News Update - Crude & Gold

Gold prices rose on Wednesday, extending gains from a 3 per cent rise in the previous session as the US Federal Reserve slashed its benchmark interest rate to cushion the economic impact from the fast-spreading coronavirus.

Spot gold climbed 0.3 per cent to $1,643.76 per ounce by 0257 GMT, having registered its biggest one-day percentage gain since 2016 on Tuesday. US gold futures gained 0.1 per cent to $1,645.30.

The Fed trimmed interest rates by 50 basis points on Tuesday in an emergency move to safeguard the world's largest economy from the impact of the epidemic.

The rate cut was the US central bank's first outside of a regularly scheduled policy meeting since 2008 at the height of the financial crisis.

On Tuesday, WTI Crude prices ended higher by 0.92 percent to close at $47.2 per barrel over after the Dollar declined making Crude cheaper for other currency holders. Prices were further supported on expectations that the OPEC+ would further trim their output to counter the slumping demand due to the coronavirus outbreak in the major Crude consumer, China. OPEC+ plans to meet in Vienna on 5th -6 th March 2020. The OPEC+ might further trim their output by 1 million barrels per day in addition to the 2.1 million bpd in current output cuts. Possible supply curbs arising from major exporting countries might support Crude.

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