The prices of most commodities fell this week on persistent concerns about the negative impact of rising protectionism on demand. A softer unofficial August China manufacturing PMI reading on Monday was particularly worrying news for industrial metals as China is by far the largest consumer. Meanwhile, there was little reaction in commodities markets to the strong US non-farm payrolls number on Friday as a September Fed rate hike is now largely priced in.
Looking ahead to next week, the direction of industrial metals prices could be determined by a raft of August economic data out of China, including trade (Monday), industrial production and investment (Friday). OPEC is set to publish its monthly report on Wednesday, with August production numbers for member states. If Iran’s production is markedly lower than the preliminary data showing a 0.2m bpd fall, it would probably spark a renewed rally in the oil price.
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