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Fed Uncertainty and Gulf Tensions to Keep Commodity Markets on Edge
M
Moneycontrol•18-10-2026, 07:06
Fed Uncertainty and Gulf Tensions to Keep Commodity Markets on Edge
- •Global market sentiment was shaped by sticky inflation, Federal Reserve policy uncertainty, and a sharp pullback in technology stocks.
- •Renewed attacks on Gulf shipping routes and Ukrainian strikes on Russian refineries pushed crude oil prices to their highest levels in five months.
- •Precious metals faced pressure following stronger-than-expected inflation data but later recovered as the US dollar retreated.
- •Base metals remained weak due to inflation concerns and cautious risk appetite, while awaiting key economic data from China.
- •Crude oil rallied significantly with Brent settling near five-month highs amid mounting geopolitical supply risks and tight diesel markets.
Key Questions Answered
Crude oil reached its highest close since May at $109.86 a barrel due to mounting supply risks, including attacks on shipping vessels near the Strait of Hormuz, threats to Saudi export infrastructure, and Ukrainian strikes on Russia's Ryazan refinery.
September CPI data showed headline inflation accelerating to 3.7 percent year-on-year from 3.4 percent, driven by higher energy costs, while core inflation rose 0.3 percent month-on-month against expectations of 0.2 percent.
Precious metals recovered as the dollar retreated toward a two-week low and investors increasingly expected the Federal Reserve to leave interest rates unchanged during the month, helping spot gold bounce to $4,165 an ounce.
