USD tumbled against the euro (-0.5%) as weak housing starts and building permits triggered worries that the Fed will maintain its expansionary monetary policy for a long time. Weakness in USD boosted precious metals and COMEX gold made a new record again by soaring to as high as 1153.4. The benchmark contract finished the day at 1141.2, up +0.2%.
US housing starts plunged -10.3% mom to 529K in October. The reading did not only miss market expectation of a modest increase to 598K but also dragged housing starts to the lowest level since April 2009.
Paulson & Co announced that it would launch a new gold fund investing in mining companies and bullion-related derivatives. The hedge fund firm, with over 10% of its $30B AUM in gold-related assets, has been a major investor in gold ETFs and gold mining shares. The new fund should give further boost to gold price.
Crude oil initially surged to 80.33 after the US Energy Department reported that oil inventory dropped last week. However, similar to what has happened in recent weeks, selling pressure emerged as price briefly broke about 80. The benchmark contract ended the day at 79.58, up +0.6%.
Crude inventory drew -0.89 mmb to 336.8 mmb in the week ended November 13 as led by decline in the Gulf Coast as attack of Hurricane Ida suspended oil imports and productions. However, builds were seen in the East Coast, West Coast and the Midwest.
Gasoline stockpile dropped -1.76 mmb as demand rose slightly to 9.02M bpd. While improvement should continue in coming weeks in preparation for the Thanksgiving holiday, current level of consumption remained low compared with historical average.
Distillate stockpile was down -0.33 mmb with demand edging higher to 3.6M bpd. However, in a bigger picture, distillate consumption made no changed from October's average and demand from the industrial sector remained stagnant. Refinery runs slipped to 79.4%, down -0.5% from the prior week.