I. Precious Metals
Gold
Gold steadied at around $1,235 on Wednesday. Many Fed policymakers said it may be appropriate to raise interest rates "fairly soon" should jobs and inflation data come in line with expectations, minutes of their Jan. 31-Feb. 1 policy meeting showed. The minutes also showed that the central bank has ample time to deal with higher inflation , but the risk is low as believed by many policymakers. The dollar shifted lower as the statement reduced expectations of a hike next month, providing a floor to gold. Investors were also looking ahead to an address by U.S. President Donald Trump to Congress next week at which he is expected to announce tax policies.
On technical front, we maintained our view that gold would remain rangebound between the 100-day and the 200-day moving average. The momentum in the MACD  continued to contract, indicating higher likelihood for a consolidation.

Silver
Silver tracked gold, lingering above the 200-day moving average in a tight range as investors awaited more clues on fundamentals. If gold pulls back, silver would find support at the 100-day moving average of $17.10. Investors shall cautiously take two-way trading when that happens.

II. Commodities
Crude Oil
Oil prices fell 1.5 percent on Wednesday, on expectations of another surge in U.S. inventories, retreating from multi-week highs hit in the previous session. Analysts expected an increase of 3.5 million barrels in U.S. crude inventories in a Reuters poll, ahead of the API and EIA’s weekly report. Despite the swelling inventories, analysts and traders were largely optimistic about the sustainability of the rally over the last four sessions. Also, OPEC signalled optimism over its deal with other producers to curb output. As a result, oil prices are expected to extend gains in near term.

Copper
Benchmark copper on the London Metal Exchange, which hit a 21-month high above $6,200 a tonne this month, ended down 0.3 percent at $6,040, as funds cut bets on higher copper prices on Wednesday. A government-mediated meeting between BHP Billiton and striking workers at its Escondida mine in Chile failed on Monday. Escondida has said it will not hire temporary staff to replace striking workers for at least 30 days into the stoppages. Nervousness about supplies are expected to support prices as the strike will be contained duration wise.

Soybean
U.S. soybean futures fell to a three-week low on Wednesday, pressured by technical selling and strong South American harvest prospects. Chicago Board of Trade March soybeans settled down 3-1/2 cents at $10.22-3/4 per bushel after dipping to $10.22-1/4, the contract's lowest since Feb. 1. Traders awaited direction from a U.S. Department of Agriculture forum this week in which the government will offer forecasts on what U.S. farmers will plant this spring. Traded volumes of soybean, soymeal and soyoil were expected to stood at 212,378 lots, 123,584 lots, and 174,020 lots respectively.

Dealing Room, ICBC Beijing Branch
Cheng Yu