HSL Prime Research Commodity Daily Report 31 July 2026

GLOBAL MARKET ROUND UP

Gold edged lower on Friday as investors booked profits following the previous session’s rally, while a modest recovery in the U.S. dollar also weighed on bullion. Despite the pullback, the precious metal remained on track for its first monthly gain in five months, supported by bargain buying around the $4,000 level and persistent geopolitical uncertainty in the Middle East.

Bullion also remained underpinned after the Federal Reserve left interest rates unchanged this week despite mounting inflationary pressures stemming from renewed hostilities in the Middle East. However, gains continued to be capped by expectations of tighter U.S. monetary policy, with investors still pricing in roughly a 63% probability of a 25-basis-point rate hike in September, according to CME FedWatch data.

Market will continue to monitor developments in the Middle East for their impact on energy prices and inflation, while evolving expectations for the Federal Reserve’s policy path are likely to remain the key driver of gold prices in the near term.

Crude oil prices traded lower during the Asian session on Friday after falling nearly 1% in the previous session, as signs of improving shipping activity through the Strait of Hormuz and continued diplomatic efforts to ease tensions in the Middle East helped ease concerns over potential supply disruptions. Despite ongoing hostilities in the region, sentiment improved after Qatar dispatched its first LNG cargo through the strategic waterway, while reports indicated that Saudi Arabia had proposed a multinational naval coalition to safeguard key shipping routes. Additional pressure came from weak demand indicators in China, where elevated crude inventories continued to dampen import demand, easing fears of an immediate supply shortage.

Despite the latest pullback, crude oil prices are expected to remain highly volatile as investors continue to monitor geopolitical developments in the Middle East, with any escalation in the conflict or disruption to regional energy supplies likely to trigger renewed upside pressure on prices.

Natural gas prices rose on Thursday after U.S. storage inventories increased by 28 Bcf last week, below market expectations of a 37 Bcf build. Additional support came from forecasts for warmer U.S. weather, which are expected to boost cooling demand and natural gas consumption.