Commodity Article : Gold slips as dollar strengthens, Crude settles lower Says Prathamesh Mallya, Angel One
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Below is Daily Commodity Article by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities, and Currencies, Angel One Ltd
Gold slips as dollar strengthens, Crude settles lower.
GOLD
Post settling the week on a higher note, gold prices came under pressure in the subsequent week, as prices drifted lower on Tuesday, ending with nearly 2 percent cut.
During his semi-annual testimony, Fed chair Powell delivered his first testimony before the Senate Banking Committee and will testify today at the House Financial Services Committee.
Investors are still concerned about whether the Fed will resume big hikes as a result of recent strong economic indicator
For fresh hints about the US central bank's monetary policy, market players eagerly anticipate the release of the US jobs data for February on Friday.
Outlook: We expect gold to trade lower towards 54720 levels, a break of which could prompt the price to move lower to 54510 levels.
CRUDE OIL
After posting handsome gains in the previous week, the new week didn't seem to go as planned. On Tuesday, both the benchmark indices cracked lower, each ending with a 2 percent cut.
The pressure in the oil prices came on the back of Federal Reserve Chair Jerome Powell in his testimony mentioned that the central bank would likely need to raise interest rates more than expected in response to recent strong data raising concerns of weaker demand.
The US dollar, which normally trades inversely with oil, was boosted by Powell's remarks to a three-month high versus a basket of currencies.
Outlook: As a result of expectations that the US Federal Reserve will continue raising interest rates, crude prices are anticipated to remain under pressure.
BASE METALS
The base metals prices slipped lower, wiping out nearly all the gains from the previous week, as all the metals ended with over 1 percent cut.
Copper and Zinc ended with 2 percent cut. The improving demand sentiment in top consumer China was offset by hawkish comments from the US Federal Reserve Chair, as the central bank is likely to increase interest rates more than previously anticipated to tame inflation.
The remarks also caused the dollar to reach a three-month high versus a basket of currencies, which made it less appealing for holders of other currencies to buy the greenback-priced commodity.
Outlook: We expect copper to trade lower towards 736 levels, a break of which could prompt the price to move lower to 728 levels.
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Quote on Silver : Silver price falls in recent weeks Says Prathamesh Mallya, Angel One
