Commodity Capsule: Gold bound for best week in six; metal falls; oil set to fall for 2nd week | Watch video

Commodity Capsule: Gold fell on Friday as traders largely favoured the dollar ahead of more signals on US monetary policy from the Jackson Hole Symposium.

Gold was set for its first positive week in five, as it recovered from five-month lows hit earlier in August. 

Spot prices retained a closely-watched $1,900/ounce level. It has gained 1.4 per cent for the week so far.

Outlook for yellow metal remained muddled by the prospect of higher US interest rates. 

The dollar stood at over a two-month high, while Treasury yields rose back towards multi-decade highs.

Markets were now focused squarely on an address by Federal Reserve Chair Jerome Powell at Jackson Hole, due later in the day.

Metals fall as firm dollar weighs

Industrial metal prices fell on Friday and trimmed a bulk of their recent gains due to a firm dollar and weak business activity data fuelling concerns about slowing global economic growth.

The US dollar rose to its highest in more than two months and was on course for its sixth straight week of gains.

After weak purchasing managers’ index (PMI) prints from the US, eurozone, and Japan this week, the focus is largely on similar data from China, which is due next week.

On a weekly basis, copper is set to gain on China's efforts to stabilise the yuan and in hopes of improving demand ahead of a peak consumption season.

LME copper is on track for its best weekly increase in a month.

Poor economic data from China continued to pressure the demand outlook and prices.

SHFE tin was set for its best week since July 7. 

Despite weak demand, supply pressure is rising after Myanmar banned ore mining in August.

Oil set for second weekly fall on firm dollar

Oil rose, although headed for a second week of decline on Friday, as the dollar firmed before a speech by Federal Reserve Chair Jerome Powell

Crude prices are set to fall between 1.5 per cent to 2 per cent for the week, the second consecutive week of decline.

Investor caution ahead of Powell's remarks at the Jackson Hole Symposium lifted the dollar to a 10-week high, its biggest rise in a month

On the supply side, talks between Turkey and Iraq's semi-autonomous Kurdistan regional government on northern Iraqi crude oil exports are still going on after officials failed to reach an agreement to restart oil exports earlier this week.

Saudi Arabia will likely roll over a voluntary oil cut of one million barrels per day for the third consecutive month into October, amid uncertainty about supplies and as it targets drawing down global inventories further.

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