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

GOLD

The yellow metal prices surged on Thursday, as it crossed the $1900 mark, however, couldn't settle above the same. Bullion gained over 1 percent and settled at 1896.9$ per ounce.

With this increase in price, gold was on course to post a fourth weekly gain, helped by a weaker dollar and forecasts of a more gradual US Federal Reserve interest rate increase.

The dollar index was projected to lose more than 1% of its value this week. Foreign buyers find bullion more appealing due to a declining value of the dollar.

For the first time in more than 2-1/2 years, US consumer prices decreased in December, raising hopes that inflation was finally on a sustainable downward trend.

Outlook: We expect gold to trade lower towards 55610 levels, a break of which could prompt the price to move lower to 55420 levels.

CRUDE OIL

Crude further extends the winning run, as prices close on a higher note on Thursday, with Brent gaining nearly 3 percent and NYMEX gained over 1 percent.

With strong indicators of demand growth in China, the world's largest crude oil importer, and forecasts for less aggressive interest rate increases in the US, crude prices are on course to increase by more than 5% for the week.

The dollar has fallen to a nearly nine-month low after data revealed that US inflation declined for the first time in 2-1/2 years, supporting hopes that the Federal Reserve may decrease the pace of rate hikes. This has helped to support oil prices.

Oil tends to be more in demand when the dollar is weaker since it becomes more affordable for buyers using foreign currencies.

Outlook: We expect crude to trade lower towards 6250 levels, a break of which could prompt the price to move lower to 6120 levels.

BASE METALS

The industrial metals largely ended on a higher note on Thursday, however, metals such as Copper and Lead ended slightly on a lower note on the MCX.

Following an unexpected drop in US consumer prices on Thursday, copper prices rose to their highest level in seven months, allaying concerns that recent increases had been exaggerated due to weak physical demand.

Prior to that, it reached a high of $9,240, the highest level since June 16 as speculation about central bankers being able to scale back on interest rate increases grew in response to US inflation figures.

Due to the decline in the dollar index, commodities purchased in US dollars are now more affordable for customers using foreign currencies.

Outlook: Metal prices are expected to stay elevated on the back of improving demand given the developments on the major metal's consumer, China.

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