Below are Quote On Gold trades higher while Oil retreats from record high levels By Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd
Impasse on OPEC’s production stance weighed on Gold in the week gone by whilst Gold remained elevated on the back of a lower Dollar.
Spot Gold ended the week with gains of 0.9 percent while MCX Gold prices rose over 1.3 percent as the benchmark US Treasury Yield retreated during the week, lowering the opportunity cost of holding the bullion metal.
The minutes of the US Federal Reserve policy meet last month indicated towards a sooner than expected tapering of the asset purchase program. Despite mounting inflation worries, a relatively high unemployment figures still remained a major concern for the FED. However, no further hints on tightening of the monetary policy undermined the US Dollar and treasury yield.
Soaring number of Delta variant COVID-19 cases ignited worries over extension of lockdown in major economies and derailing the global recovery which further supported the safe haven asset, Gold.
WTI Crude prices rose over 2.2 percent in the week gone by as lack of clarity on OPEC’s production stance in the months ahead weighed on the market sentiments.
The Oil Exporting group failed to reach an agreement to raise supply in order to meet rising global demand after Saudi Arabia, the de facto leader of the group, and UAE were unable to strike a deal.
Also, worries over tighter pandemic led curbs in many regions of Asia, Australia and Europe following the increase in the Delta variant cases further pressured Crude Oil prices.
The losses for Crude were limited as US Crude inventory plunged over 6.9 million barrels in the earlier week surpassing the market expectation of a 4-million-barrel decline, data as per the Energy Information Administration.
Lead & Nickel posted the highest gains while Aluminium and Copper scaled lower during the week on the LME. Lead gained over 1.7 as soaring demand for lead acid batteries amid mounting freight problems and plummeting LME inventory levels raised worries of potential shortage in the global Lead markets.
After the successful first round of China’s State Reserve metal auction, China's National Food and Strategic Reserves Administration announced to continue releasing inventories in the times ahead in an attempt to ease commodity prices.
That, coupled with prospects of an early tapering of the asset purchase program by the US Federal Reserve and an evident slowdown in China’s economy pressured the industrial metal prices.
LME Copper ended flat percent despite of a lower Dollar and funds buying in as worries over slowdown in prime Copper consumer China pressured the prices.
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