Oil prices rose and gold extended its gains on Thursday after the Federal Reserve cut US interest rates on Wednesday by half a percentage point to 1 per cent, prompting the dollar to weaken.
Commodity markets enjoyed a better session on Wednesday as following the Fed’s widely anticipated decision to cut US rates with the Reuters-Jefferies CRB index, a global benchmark, jumping almost 6 per cent propelled by a surge in energy, metals and agricultural raw materials.
In the oil market, Nymex December West Texas Intermediate rose 75 cents to $68.25 a barrel after hitting a session high of $70.60, while ICE December Brent rose 50 cents to $65.97 a barrel after reaching a high of $68.35.
Gold traded at $768 a troy ounce, ranging between a low of $758 and a high of $776.30 after ending trading in New York on Wednesday at $754.30, supported by dollar weakness and gains for equity markets.
Base metals prices softened, giving back some of this week’s strong rebound which has been driven largely by short covering as producers have begun announcing substantial cuts in output.
Copper dipped 1.4 per cent to $4,480 a tonne while aluminium slipped 0.3 per cent to $2,127 a tonne, tin eased 1.7 per cent to $14,750, lead lost 1.3 per cent to $1,510 a tonne, nickel dipped 1.9 per cent to $12,800 a tonne and zinc retreated 2.4 per cent at $1,220 a tonne.
