Gold and silver dive lower heading into the European open

London (Jan 6)  Gold is trading -0.47% lower just at the $1800/oz area following the FOMC minutes last night. Silver is also struggling after falling 1.50% overnight. In the rest of the commodities complex, copper has dropped half a percent and spot WTI bucked the trend to move 0.39% higher.

Since the money markets are now pricing in a 70% chance of a Fed hike at the March meeting indices fell overnight. The Nikkei 225 (-2.88%), ASX (-2.74%) and Shanghai Composite (-0.25%) all dipped lower. Futures in Europe are indicating a negative cash open.

In FX markets, the dollar index is 0.20% higher, AUD/USD was the biggest casualty falling 0.84%. In the crypto space, BTC/USD is -0.75% in the red.

News from overnight:

China is advising travelers to cut longer-haul trips over the approaching New Year holidays. China's Xian Xianyang International Airport suspends all international passenger flights.

BOJ offers large cash injection after long-term interest rates hit a two-month high.

ECB's Kazaks says Bank will act if inflation outlook picks up.

US Treasury 30-year yields are at their highest since October last year.

The Italian government is to make Covid-19 vaccination mandatory for over 50s.

U.K.'s new car sales in 2021 were down nearly 30% on pre-pandemic levels.

China - Caixin Markit Services PMI for December 53.1 (expected was 51.7).

Australia – Markit Services 55.1 and Composite 54.9 PMI for (final) December.

Japan Jibun Services 52.1 and Composite 52.5 PMIs for December.

German regional CPI reading - North-Rhine Westphalia December CPI +5.2% vs +5.1% y/y prior.

Germany November factory orders +3.7% vs +2.1% m/m expected.

Looking ahead to the rest of the session highlights include EZ construction PMI, U.K. services PMI, U.S. initial jobless claims, and U.S. factory orders.

By 08:25am EST  spot gold in New York was down $16 to $1789, while spot silver crashed more than 2% to $21.10. 

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