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"Base Metal Outlook Report" by Mr. Saish Sandeep Sawant Dessai, Research Associate- Base Metals, Angel One Ltd

The base metals pack on Wednesday saw significant momentum, with all metals concluding higher. Lead and zinc were the metals that gained the most ground.

The substantial advance was supported by a few factors that kept prices high. To begin, the much-anticipated US inflation data showed that the annual inflation rate in the US dropped to 5% in March, from 6% the previous month, the lowest since May of 2021. Furthermore, the dollar index came under pressure following lower-than-expected US inflation data, which lifted risk sentiment and fueled views that the Fed will put on hold monetary tightening after raising interest rates one last time next month. Markets are pricing in a 70% possibility of another 25-basis point hike in May.

Secondly, minutes from the Fed's most recent meeting in March revealed that several Federal Reserve policymakers considered pausing interest rate increases in the aftermath of the failure of two regional banks, forecasting that banking sector stress would tip the economy into recession, limiting the upside in metals.