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"Daily Commodity Article" by Mr. Saish Sandeep Sawant Dessai, Research Associate- Base Metals, Angel One   Ltd

GOLD

Weakness in the bullion prices persisted, as the yellow metal ended Thursday's session on a marginally negative note, down 0.16 percent and ending at 1758$ per ounce.

After nearly four weeks of gains, gold prices fell to a three-week low and were poised for their first weekly decline due to the strengthening of the US dollar and the likelihood of further US Federal Reserve rate increases, both of which reduced demand for the bullion.

When compared to its rivals, the dollar climbed to a one-month high, raising the price of gold for buyers using other currencies.

The pace of upcoming rate hikes will rely on new economic data, Fed policymakers stated in the minutes of the July meeting, which were released on Wednesday.

Gold is highly sensitive to rising US interest rates, as these increase the opportunity cost of holding non-yielding bullion. Rising US interest rates significantly impact the price of gold because they raise the opportunity cost of owning non-yielding metal.

Outlook: We expect gold to trade lower towards 51160 levels, a break of which could prompt the price to move lower to 50740 levels.

CRUDE

The bounceback witnessed in the previous session seemed to fade away, as the benchmark crude indices witnessed a mixed set of action, with spot Brent ending lower and NYMEX ending with nearly 3 percent gains.

On Thursday, oil prices rose around 3% as encouraging US economic statistics and strong US fuel consumption allayed worries that slower economic growth may reduce demand.

With a rapid increase in domestic demand and significant export demand as a result of Russia's invasion of Ukraine, US refineries have been operating at record levels this year, due to plant closings.  In the second or third quarter, historically, US production reaches its peak as the end of the summer driving season and the start of the autumn equipment overhauls coincide.

Outlook: We expect crude to trade higher towards 7400 levels, a break of which could prompt the price to move higher to 7510 levels.

BASE METALS

The industrial base metals pack witnessed a mixed trading session. Except for copper, all the other metals ended on a negative note on the LME, whereas on the MCX, except for Zinc, all the other metals ended on a positive note.

For the first time in a week, copper prices rose on Thursday as expectations for strong Chinese demand outweighed worries over the interest rate increases and sluggish economic development.

Due to excessive energy costs, closures at zinc and an aluminum smelter in Europe were reported this week.

Chinese aluminum production has reached record highs, which has helped China's imports of the metal fall 38% year-over-year in July. This is because domestic production has reached a record high, international supplies have tightened, and smelters are not subject to the power restrictions that were in place last year.