Closing Bell 17th November: Gold Mining Stocks Shine Amidst Energy Sector’s Decline

ANZ Warns of Potential RBNZ Rate Hikes
ANZ has revised its forecast for the Reserve Bank of New Zealand (RBNZ), pushing the expected start of rate cuts to 2025 and cautioning that interest rate hikes could resume. The RBNZ is anticipated to maintain the cash rate at 5.5% at its next meeting. ANZ New Zealand’s chief economist, Sharon Zollner, highlights that while hiking is not in their central forecast, it remains a significant risk, especially with inflation still high. Financial markets, however, expect a rate decrease as the next move. ANZ predicts subsequent rate cuts after 2025, bringing the cash rate to 4.75%, contrasting with bond traders who see a 60% chance of a cut as early as May 2024.

Oil Prices Hit Four-Month Low Amid Economic Worries
Oil prices plummeted to a four-month low, dropping around 5%, due to concerns over global demand following weak economic reports from the US and Asia. Brent futures fell by 4.6% and WTI by 4.9%, reaching their lowest levels since early July. The decline was influenced by rising unemployment claims in the US and predictions of reduced oil refinery activity in China. Despite OPEC and IEA forecasting supply tightness, recent US data showed abundant inventories. However, Chinese economic activity showed signs of recovery in October.

Gold Prices Surge on Fed Rate Pause Expectations
Gold prices increased by 1% to $US1980.49 per ounce, driven by expectations that the Federal Reserve may halt its rate-hiking cycle, positioning gold for a 2.3% weekly gain. The precious metal, sensitive to interest rates, benefited from signs of slowing inflation and growing bets that the Fed will keep rates unchanged in December, with potential easing in early 2024. Gold’s rise towards $US2000 per ounce reflects investors’ reassessment of the US economic strength.