On Tuesday, spot gold prices rose marginally by 0.25 percent to close at $1326 per ounce as the U.S. dollar lost ground after news that U.S. President Donald Trump replaced Secretary of State Rex Tillerson, while U.S. inflation data was in line with forecasts.
Trump fired Tillerson after a series of public rifts over policy on North Korea, Russia and Iran, replacing him with loyalist Central Intelligence Agency Director Mike Pompeo.
Also weighing on the dollar was news that U.S. consumer prices cooled in February, the latest indication that an expected pick-up in inflation is likely to be only gradual
On the MCX, gold prices rose 0.21 percent to close at Rs.30546 per 10 gms.
Spot silver prices rose 0.3 percent on Tuesday to close at $16.5 per ounce in line with rise in gold prices and uptick in the base metals pack. On the MCX, silver prices rose by 0.1 percent to close at Rs.39307 per kg.
We expect gold prices to trade sideways today as uncertain events in the Trump administration, stable inflation and in turn prospects of rate hike by the US FED are near term push factors.
On the MCX, gold prices are expected to trade sideways today; international markets are trading higher by 0.15 percent at $1328 per ounce.
WTI oil prices declined 1.1 percent on Tuesday to close at $60.7 per barrel after posting two days of falls at the start of the week.
Reports of U.S. crude inventories are not rising as much as expected during the spring season that is starting, implying healthy demand.
U.S. crude inventories rose by 1.2 million barrels in the week to March 9, to 428 million barrels, the American Petroleum Institute said on Tuesday.
U.S. crude oil production has risen by almost a quarter since mid-2016 and output soared past 10 million bpd in late 2017, overtaking production by top exporter Saudi Arabia. On the MCX, oil prices declined 1.5 percent to close at Rs.3919 per barrel.
Rising oil inventories in the US and refineries going for maintenance across US and Europe will result in correction in oil prices.
On the MCX, oil prices are expected to trade lower today, international markets are trading marginally higher by 0.2 percent at $60.82 a barrel.
Base metals traded higher on Tuesday as US Trump’s decision to replace Secretary of State Rex Tillerson, weighed on dollar denominated commodities.
MCX base metals traded higher in line with international trends.
LME Copper prices gained 0.5 percent on Tuesday to close at $6945/t as Donald Trump fired his Secretary of State Rex Tillerson without offering any explanation or forewarning, leaving US diplomacy in turmoil.
This is another significant exit from the White House after disagreements with the President about his policy on trade tariffs led to resignation of economic advisor Gary Cohn.
Last week, Copper prices were hurt by stronger dollar index after US President Donald Trump formally announced tariffs on steel and Aluminum imports effective after 15 days, leaving Canada and Mexico exempt from the levies for now. He imposed 25 percent import tariff on steel and 10 percent tariff on aluminium, thereby escalating worries of retaliation from other major trading partners.
MCX copper prices rose marginally on Tuesday to close at Rs.451 per kg.
LME Copper prices are currently higher by 0.5 percent at $6978 per tonne. We expect copper to trade higher today as China’s industrial production hit a 6-month high in Jan-Feb’18, beating estimates. Also, diplomacy concerns in the White House will weigh on dollar. However, US retail sales and inflation data due tonight will be keenly awaited.
MCX Copper prices will likely trade higher today.
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