Commodities: Futures reel after US President extends tariffs to almost all Chinese exports

Commodity prices were lower almost across the board on Thursday, after the US central bank decided overnight to push back on expectations for interest rate cuts extending out into 2020 and the US President announced the decision to impose tariffs on almost all the remaining Chinese imports to the US not yet covered by trade levies.

Roughly two hours after the close of trading in London, Donald Trump said in posts to his personal account on social media platform Twitter that: "Our representatives have just returned from China where they had constructive talks having to do with a future Trade Deal.

"We thought we had a deal with China three months ago, but sadly, China decided to re-negotiate the deal prior to signing. More recently, China agreed to buy agricultural product from the U.S. in large quantities, but did not do so.

"Additionally, my friend President Xi said that he would stop the sale of Fentanyl to the United States – this never happened, and many Americans continue to die! Trade talks are continuing, and during the talks the U.S. will start, on September 1st, putting a small additional Tariff of 10% on the remaining 300 Billion Dollars of goods and products coming from China into our Country. This does not include the 250 Billion Dollars already Tariffed at 25%."

In response, as of 1840 BST, the US dollar spot index had reversed course slightly to drift lower by 0.03% to 98.48 and the Bloomberg commodity index was down by 2.42% to 77.05.

Energy futures were pacing losses, adding to earlier slide.

Front month West Texas Intermediate crude oil was down by 3.77% at $56.37 a barrel on the NYMEX, alongside a drop of 5.69% to $1.7568 a gallon for the September RBOB gasoline contract.

Gold futures on COMEX however were paring earlier losses although they remained off by 0.33% at $1,433.0/oz., having earlier plumbed an intra-session low of $1,412.10/oz..

December corn on CBoT meanwhile was falling 2.80% to $3.9850 a bushel.