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Below is Daily Commodity Article by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities, and Currencies, Angel One Ltd

Gold continues to head southwards, Crude gains notably higher.

GOLD

Weakness in the yellow metal continues to yet another week, as gold prices slip over 1 percent in the recent concluded week. 

Gold prices fell more than 1% in the most recent week, indicating that the yellow metal will remain weak for yet another week. 

The Federal Reserve is likely to maintain higher interest rates for a longer period of time, according to minutes from its most recent policy meeting, which put pressure on the price of yellow metal. 

Further, the dollar index that climbed towards 7-week highs, further dragging gold prices to lower levels. The market anticipates that the US central bank will maintain annual interest rates above 5%. 

An surprise uptick in US economic activity in February saw it reach its highest level in eight months, according to a survey that also showed a decline in inflation.

Outlook: We expect gold to trade lower towards 55170 levels, a break of which could prompt the price to move lower to 54980 levels.

CRUDE

After dropping over nearly 5 percent during the previous week, crude prices managed to slightly end on a higher note, ending with marginal gains of 0.2 percent. 

As it was revealed that Russia would cut back on oil shipments from its western ports by up to 25% in March, which is more than its intended production reduction of 500,000 barrels per day, oil prices rose and ended the week on a slightly higher note. 

After a recent 5 percent decline, prices were under pressure as the majority of US Fed officials advocated for ongoing rate increases, which would eventually strengthen the dollar and make oil priced in dollars more expensive for holders of foreign currencies. 

Although there are growing concerns that central banks' more aggressive interest rate increases could impede economic growth and fuel demand, because of which the upside appears to be limited.

Outlook: We expect crude to trade higher towards 6470 levels, a break of which could prompt the price to move higher to 6570 levels.

BASE METALS

This week concluded with all the metals ending on a lower note, with copper also joining the lot, after it was the only metal to end on a higher note during the previous week. 

Metal prices declined as a result of worries about the central bank raising rates further, which might hinder economic development coupled with weak metal demand in China. 

US economic activity unexpectedly rose to an 8-month high in February, according to data released during the week, suggesting that the Fed will need to tighten monetary policy more in order to keep inflation under control. 

The metals pack did show some hope during the course of the week as they inched higher, but this was countered by a stronger dollar as investors readied themselves for higher interest rates from the US Federal Reserve. 

On the other hand, because aluminium smelters in China were cutting back on production, aluminium prices rose by over 3% during the course of the week. Yunnan, one of China's key producing provinces, is expected to see a decrease in aluminium production as a result of the mandated reductions.

Outlook: We expect copper to trade lower towards 743 levels, a break of which could prompt the price to move lower to 733 levels.

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