Abans Group Commodity World Round Up

3rd Aug – 7th Aug

1. China tensions escalated with President Donald Trump's move to ban WeChat and TikTok.

Aug 6, 2020

U.S. President Donald Trump has unveiled sweeping bans on U.S. transactions with the Chinese owners of messaging app, WeChat, and video-sharing app, TikTok. It will be escalating a high-stakes confrontation with China over the future of the global tech industry. Meanwhile, China has said on Friday, the companies comply with U.S. laws and regulations, and warned that the United States would have to "bear the consequences" of its action.

Source: New York Times

2. US Nonfarm payroll added 1.763 million jobs in July, and unemployment rate at 10.2%

Aug 7, 2020

US Nonfarm payroll (NFP) added 1.763 million jobs in July, against an expected 1.600 million jobs, and previous 4.791 million jobs, while the unemployment rate stood at 10.2%, against an expected 10.5%, and previous 11.1%. Two months of record-setting payroll growth slowed in July, but was still better than Wall Street estimates, even as a rise in coronavirus cases put a dampener on the struggling U.S. economy.

Source: CNBC

3. The Bank of England (BOE) central bank’s main lending rate was kept unchanged

Aug 6, 2020

The Bank of England (BOE) central bank’s main lending rate was kept at 0.1%, after it cut rates twice from 0.75%, since the beginning of the coronavirus pandemic. The Monetary Policy Committee opted against extending its bond buying program, having announced a £100 billion ($131.4 billion) expansion in June, which took the total Asset Purchase Facility to £745 billion. The central bank warned that UK unemployment will spike at 2.5m by the end of the year, as firms cut jobs due to the shock of Covid-19. In its latest forecasts, the Bank predicts the jobless rate will almost double to 7.5%, and only fall slowly in 2021.

Source: CNBC

4. China's iron ore imports for the month of July 2020 at record highs

Aug 7, 2020

According to China’s customs data, Iron Ore imports in July increased by 10.8%, month-on-month, to a record high of 112.65 million tonnes, while on a year-on-year basis, the imports are up 24%, from 101.68 million tonnes in July 2019.

Source: Metals Bulletin

5. China's July export-import data may point to a more sustainable recovery

Aug 7, 2020

China’s economy appeared to be gathering steam in July, as exports rose the most in 2020, while some raw material imports hit record highs. According to customs data, exports in July increased 7.2% YoY, the fastest pace since December 2019, against expectations of a 0.2% drop, while the MoM rise was 0.5%.

Source: Reuters

6. US Crude oil stocks decline by -7.4 million barrels in the week ended July 31:EIA

Aug 4, 2020

Crude oil stocks dropped by 7.4 million barrels against a market forecasted drop of 3 million barrels in the week ended July 31st, according to the weekly report published by the US Energy Information Administration (EIA)

Source: Market Watch

7. India’s gold imports fell in July: Reuters Report

Aug 4, 2020

According to a Reuters report, India’s gold imports in July fell 24% from a year earlier, as a rally in local prices to a record high, curtailed retail purchases, amid the lockdown in many towns. India imported around 30 tonnes of gold in July, down from 39.66 tonnes a year ago. In value terms, July imports edged up to $1.78 billion, from $1.71 billion a year ago.

Source: Reuters

8. US Natural Gas jumps to highest since January on rising LNG exports, and hot weather

Aug 4, 2020

U.S. liquefied natural gas exports are on track to rise in August for the first month in six months, helping boost U.S. gas prices by over 17% on Monday. The amount of gas flowing to U.S. LNG plants averaged 4.0 billion cubic feet per day (bcfd) so far in August, according to Refinitiv, putting LNG exports on track for their first monthly gain, since hitting a record high of 8.7 bcfd in February. This compares with a 21-month low of 3.3 bcfd in July, when buyers cancelled the most cargoes in a month.

Source: Reuters

9. US Markit Manufacturing PMI edges higher to 50.9 (final) in July vs. expected print of 52.

Aug 3, 2020

The IHS Markit's Manufacturing PMI rose from 49.8 in June, to 50.9 (final) in July, and revealed a modest expansion in the manufacturing sector's economic activity. However, this reading came in worse than the previous estimate of 51.3, and missed the market expectations of 52.

Source: FxStreet