Commodities Daily - March 6, 2019

> Oil price flat amid downbeat API inventory data; EIA weekly update eyed. We are neutral about where oil prices are headed today. We do expect the EIA to confirm w-o-w crude oil inventory builds, although we think that the build will be smaller than the API showed (likely capped below 4 mln bbl). Nevertheless, we expect it to be sufficient to dent sentiment - and therefore prices. Brent could dip below $65/bbl as an initial reaction. Total petroleum inventories, however (crude and products combined), are expected (by the market) to be slightly down w-o-w despite the crude oil builds. In our view, this should support prices later in the day when report is fully digested and could help push Brent back toward the $65/bbl mark.> Gold fights off stronger dollar amid US-China trade deal uncertainty; ECB meeting and US non-farm payrolls on the radar. Tomorrow's ECB monetary policy meeting is on the radar, as is US non-farm payrolls on Friday. Both of these events are likely to lead to dollar strengthening against DM currencies. Our FX analysts, expecting the ECB to strike an even more dovish tone and the US labor market data to continue showing robust growth, see the dollar appreciating mildly on these factors today, which would weigh on gold prices. However, we still see strong support for gold at $1,280/oz and do not expect it to break below that today.