By Ambar Warrick
Investing.com-- Aluminum prices were set to extend gains on Thursday following a report that the U.S. plans to ban imports from Russia, while gold steadied ahead of key U.S. inflation data due later in the day.
London-traded aluminium closed over 5% higher on Wednesday after Reuters reported that the Biden administration is considering the stoppage of Russian aluminum imports in response to Moscow’s military escalation in Ukraine.
The news comes after Russia carried out a series of devastating missile strikes against Ukraine this week, in apparent retaliation over the destruction of a bridge connecting Russia and Crimea.
The White House has made no formal decision on the matter, and is only considering options, the report said. Still, the prospect of tighter supply saw aluminum prices mark their best day in over a week.
But the metal, like most other industrial metals, is down sharply this year amid growing fears of a global recession.
Gold prices were steady on Thursday after rising slightly in the prior session. Spot gold rose about 0.1% to $1,673.62 an ounce, while gold futures rose 0.2% to $1,681.1 an ounce.
Bullion prices sank this week amid more hawkish signals from the Federal Reserve, as well as growing safe haven demand for the dollar. Markets are now awaiting key U.S. CPI inflation data later today for more cues on the path of U.S. monetary policy. The reading is expected to show that inflation remained near 40-year highs in September.
Minutes of the Fed’s September meeting, released on Wednesday, showed that policymakers unanimously agreed to push monetary policy into restrictive territory, and are likely to keep interest rates high for a longer period as the central bank struggles to bring down inflation.
The minutes boosted the dollar, pushing it closer to a 20-year high. Data also showed that U.S. producer price inflation grew more than expected, giving the Fed more impetus to tighten policy.
Metal markets fell sharply this year as rising inflation and interest eroded demand for both precious and industrial goods. With most global central banks turning hawkish, this trend is expected to continue in the near term.
Copper prices traded steady on Thursday after falling nearly 1% in the prior session.