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

GOLD

While it ended the most recent week on a weaker note, the yellow metal continued to have lacklustre sessions.

While expectations for the Federal Reserve to continue tightening monetary policy as a result of the week's inflation data, bullion fell to its lowest levels since January. 

The consumer price index increased by 6.4% in January after increasing by 6.5% in December, which was the smallest increase since October 2021.

Because of its competitive nature with the dollar as a safe store of value, gold becomes less desirable to foreign investors when the dollar's value rises.

Outlook: We expect gold to trade lower towards 55980 levels, a break of which could prompt the price to move lower to 55780 levels.

CRUDE OIL   

Crude prices have been fluctuating in recent weeks, as the NYMEX ended the week with a drop of around 5%.

Concerns that rising interest rates would slow the economy and decrease demand for oil contributed to the pressure, which limited the upside due to the strengthening of the US dollar.

Officials at the Federal Reserve claim that in order to fight inflation, the US central bank must keep steadily boosting interest rates. Investors worry that the economy may suffer if interest rates rise.

With worries about an oncoming recession in the United States, rate hikes to combat inflation, and hope for a revival in China's demand, oil prices have been swinging back and forth.

Outlook: We expect crude to trade lower towards 6190 levels, a break of which could prompt the price to move lower to 6070 levels.

BASE METALS

The weakness in the base metals is still present, as every metal except copper closed the most recent week on a lower note.

A weaker dollar and a rally in metals were initially sparked by the US consumer prices data for January, which revealed the weakest annual gain since late 2021.

Because of expectations that China's economy will rebound from its downturn last year, industrial metal prices increased in January, with aluminium reaching a seven-month high.

However, post that, due to weak Chinese demand and a quick buildup of supplies in exchange warehouses, aluminium prices fell to five-week lows.

Outlook: Metals prices are antici[ated to be under pressure, given the sentiments that the US Fed would keep the interest rates high, in order to control the rising inflation.

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