Gold and silver have extended their gains made on the back of the weaker-than-expected U.S. employment report on Friday. The dollar-denominated commodities have obviously found support from a slightly weaker dollar as investors lowered their expectations about the timing of the next rate increase. With the key U.S. ISM services PMI due to be released shortly, the near-term outlook for the dollar, and in turn precious metals, could change course once again.
With only a couple of pieces of economic due to be released, focus is likely to remain on movements in commodity markets as well as the ongoing reaction to Friday’s jobs report and what it means going forward for U.S. interest rates. The ISM non-manufacturing PMI is often keenly followed by traders, unsurprising given the importance of the services sector to the U.S. economy.
Britain's economy is shrinking at its fastest rate since the financial crisis after last month's Brexit vote, making a Bank of England rate cut tomorrow a "foregone conclusion", a closely watched survey of businesses showed.
We have another big week in store in the markets, with particular focus falling on Thursday’s Bank of England monetary policy decision and Friday’s U.S. jobs report. The BoE opted last month to go against expectations and hold off on easing monetary policy following the Brexit vote in June as it wanted to gather more data before deciding on the best course of action.
Stocks found some much-needed support this week on the back of a rising oil price to $50 a barrel and as concerns about the negative impact of a potential June Federal Reserve rate increase diminished.