Commodity Capsule: Brent crude oil edges higher; gold range-bound

Commodity Capsule: Oil prices edged up on Friday and were set to end the week modestly higher.

Markets awaited an OPEC+ decision on supply agreements for the second quarter amid differing demand indicators from the U.S. and China.

Brent futures for May climbed past $82 a barrel. US WTI for April hovers near $78.50.

WTI is on track for at least a 2.5 per cent increase this week. Brent has hovered largely above the $80 mark for three weeks.

A survey suggests Organization of the Petroleum Exporting Countries pumped 26.42 million barrels per day this month, up 90,000 bpd from January.

The market expects OPEC to decide on extending the cuts is expected in the first week of March, with member nations expected to announce their decisions.

The US personal consumption expenditures index, showed January inflation in line with economists' expectations, keeping June interest rate cut on the table.

China's manufacturing activity in February contracted for a fifth straight month—NBS. This is raising pressure on Beijing policymakers to roll out further stimulus measures as factory owners struggle for orders.

Gold prices were largely range-bound at a three-week high on Friday and were set for a second weekly rise.

Yellow metal edged up $20 in the last two trading sessions as US inflation was gradually easing, while the market focusses on remarks of Federal Reserve officials.

Global gold futures were steady past $2050 – its highest level since Feb. 2.

US personal consumption expenditures price index rose by 0.3 per cent in January. Core PCE price index gained 0.4 per cent. In the 12 months through January, inflation rose 2.4 per cent - the smallest in three years.

US central bankers are looking through recent data showing price pressures rebounded last month, and are focusing instead on overall progress on inflation that they say will likely set the table for interest-rate cuts later this year.

At least six Fed officials are due to speak on Friday.

Markets are betting on about three quarter-point interest rate cuts for 2024 in the US, with a 65 per cent chance of the first one coming in June.

LME metals were largely rangebound after a lackluster monthly performance in February.

Barring Nickel, which gained 10 per cent in February, all the other metals shed nearly 1.5-5 per cent last month.

Iron ore prices advanced on Friday, aided by growing expectations of improved demand and more stimulus to be unveiled in the coming week in China.

Iron ore contract on Dalian Commodity Exchange inched towards 900 yuan/mt. Iron ore on the Singapore Exchange edged past $117 a ton.

China's manufacturing activity in February contracted for 5th straight month, an official factory survey showed, raising pressure on policymakers to consider further stimulus measures.

On the contrary, private-sector surveys showed both production and new orders grew faster last month, pushing business confidence to a 10-month high.

Eyes are on China's annual parliament meeting National People's Congress, which will convene on March 5 with a series of economic targets and policy priorities for this year.

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