EUROPEAN COMMODITIES UPDATE: XAU outperforms after Trump sends letter to Fed's Cook; Crude gives back geopolitical driven gains

WTI/Brent: -1.0%/-1.1%

• Crude futures trade with losses near USD 0.9/bbl amid a downbeat mood across global markets, and a broad reversal of geopolitical gains made on Monday as Ukrainian Strikes on a Russian oil terminal did not have a great impact to any barrels.


• Benchmarks have been gradually edging lower for the entire session, with a recent low of USD 67.45/bbl for Brent after it breached below its 21DMA at USD 67.78.


• On the geopolitical front, Ukrainian President Zelensky said he had a good meeting with US Envoy Kellogg and that Ukraine values US readiness to be part of Ukraine's security architecture, while he discussed with Kellogg how to exert pressure on Russia to hold "real talks" to end the war and said military cooperation is important with the US, particularly on purchases of weapons and accord on drones. Separately, it was also reported that US and Ukrainian officials are expected to meet later this week.


• In the Middle East, US President Trump said Gaza has to be settled soon, and he thinks they will have a good and conclusive ending within the next 2-3 weeks.


• Looking ahead, API weekly energy inventory data will be released after the US close.

Gold: +0.4%

• Spot Gold is boasting gains, and is the clear outperformer in the metals space, with Silver flat and Palladium and Platinum continuing losses.


• The yellow metal benefits after US President Trump ordered the removal of Fed Governor Lisa Cook, alleging false mortgage statements. This move from the US President raises further questions on the Fed’s independence, and will likely continue as the President wishes to craft his own Fed board. A dovish reaction was seen in the fixed income space, with the long end pressured on speculation that Trump’s replacement would be rate-cut-friendly.


• Key technical levels include its 21, and 50DMA at USD 3,349/oz, and USD 3,346/oz, respectively. To the upside is the August 9th high of USD 3405/oz.


• On the speaker’s slate, Fed’s Barkin (2027 voter) will give remarks; after the European close, BoE’s Mann (Hawk) will speak on “The Institutional evolution of central banks: providing stability”.

3M LME Copper +0.2%

• Copper outperforms in the base metals space, as it catches up to Chinese optimism after LME trade was closed on Monday.


• The downbeat mood in today’s session has likely capped gains, with global risk assets broadly lower.


• The industrial metal trades within USD 9,792.35-9,867.38/t parameters.

26 Aug 2025 - 10:00- ForexGeopolitical- Source: Newsquawk