Now Reading
Oil prices drop, gold rates up as Trump declared US President

Oil prices drop, gold rates up as Trump declared US President

The dollar is weakening and Asian stocks have dropped

World markets and commodities reacted in shock on Wednesday as Donald Trump won the US Presidential elections.

The dollar is weakening and Asian stocks have dropped. Earlier on Wednesday, the Japanese Nikkei was down 5.9 per cent while the Hong Kong Hang Seng Index dropped by up to 4 per cent.

The commodity space has seen different developments, according to Ole Hansen, head of commodity strategy at Saxo Bank.

Also read: Trump elected President of the United States
Survey indicates Arab support for Clinton but agreement with Trump on some issues

Trump is a ‘loose cannon’ – senior Dubai businessman

Saudi billionaire Prince Alwaleed calls Trump “disgrace to the US”

“Trump is viewed by the market as being opposed to free trade which could slow global growth and thereby reduce demand for commodities dependent on growth and demand. Trump is also pro-fossil fuel (oil bearish) and wants to scrap the nuclear deal with Iran and re-introduce sanctions (oil bullish),” he said in a Wednesday morning report.

“As a result we are seeing HG copper and WTI crude oil coming under pressure despite the support from a weaker dollar.”

During a speech in September, Trump said he would end “all unnecessary regulations, and a temporary moratorium on new regulations not compelled by Congress or public safety.”

Trump’s win is also likely to remove the risk of a December rate hike from the Federal Reserve, said Hansen.

“A raised risk of recession with inflation pressure rising combined with the weaker dollar are all gold supportive.”

Gold touched a high of $1,337, making it a $70 bottom to top move. During the Brexit night back in June gold jumped by $108.

Silver and platinum are underperforming due to their links to industrial metals, he added.

© 2020 MOTIVATE MEDIA GROUP. ALL RIGHTS RESERVED.

Scroll To Top