The report of the US GDP in the third quarter grew higher than expected, which will support the Fed to tighten its economic policy, contributing to difficulties in commodity prices in general.
London Robusta chart January 1, 2023, week 43 (from October 24, 2022 to October 29, 2022)
For the whole week 43, the London market had 1 gaining session and 4 decreasing sessions. The price of Robusta coffee for January delivery fell all of $147, or 7.36 percent, to $1,849 per ton, and March delivery fell all of $143, or 7.22%, to $1,837. /ton, the reductions are very strong. Trading volume remained very high above average.
In contrast, the New York market had another 5 consecutive declines. The price of Arabica coffee for December delivery fell all of 21.10 cents, or 11.05%, to 169.80 cents/lb, and the March delivery date fell by all of 18.05 cents, ie. down 9.71%, to 167.75 cents/lb, extremely strong declines. Trading volume remained very high above average.
The price of green coffee beans in the Central Highlands market decreased from 2,800 to 2,900 dong, to range from 40,700 to 41,200 dong/kg.
The highlight of the week was the report that the US Gross Domestic Product (GDP) in the third quarter increased by 2.6%, higher than market expectations after falling for the previous 2 quarters, a sign of decreasing inflation, will be the basis for the Fed to tighten monetary policy strongly, contributing to preventing excessive inflation, causing USDX to reverse and rise in the basket of strong currencies. This is also the concern of many economic experts when they think that once “green silver coin” too strong will cause the commodity market to reduce purchasing power, which will further contribute to the world economic recession. In particular, the possibility that the Fed will raise monetary interest rates further, leading to higher borrowing rates, also discourages funds and speculations from pouring capital into commodity markets.
Meanwhile, inventory reports on the coffee futures markets continued to decline as traders delivered directly to roasters at a more attractive price than on two auction floors. The main producing countries also started the new harvest of the coffee year 2022/2023, so the pressure to sell the new crop is not small.
As of Monday, October 24, the inventory of Robusta coffee certified and tracked by the London floor has decreased by 540 tons, or 0.60 percent less than a week earlier, to 88,800 tons registered. (equivalent to 1,480,000 bags, 60 kg bags).
Notify: Markets transitioning to winter time trading:
- London Market: from 16:00 to 0:30 am.
- New York Market: from 16:15′ to 1:30am.
English (giacaphe.com)
