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Below are Views On Gold remains afloat whereas Oil continues to trade higher By Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd

Gold remains afloat whereas Oil continues to trade higher

Oil continued to trade higher on bets of a promising outlook whereas bets over delay in the ticketening the policy by the US Central bank kept Gold elevated.

Gold

On Tuesday, Spot Gold ended lower by 0.14 percent to close at $1802.6 per ounce. Spot gold continued to hover above the 1800 level as lowering bets on early tapering of the expansionary monetary policy by US kept the prices elevated.

Gold traded lower in the earlier week after the minutes of the US Federal Reserve policy meet held in July’21 hinted towards a tighter economic policy in the coming months which clouded the outlook for the bullion metals.

However, the recent outbreaks of the new variant raised expectations of a delay by the US Central bank in withdrawing the stimulus measures in order to support their economy.

Markets might remain cautious ahead of the key US economic data scheduled during the week for cues on FED’s stance in the months ahead.

Spot Gold prices remained under pressure as the Dollar rose ahead of the Powell's speech at the Fed's annual economic symposium. However, widening impact of the pandemic might continue to levy some support to the safe haven asset Gold.

Crude Oil

On Tuesday, WTI Crude rose over 2.9 percent to close at $67.5 per barrel. Oil prices extended gains from the earlier session as hopes over revival in global demand amid fire cutting near Mexico’s quarter Oil production pushed prices higher.

Optimism over revival in Oil demand following the approval to the Pfizer Inc/BioNTech SE COVID-19 vaccine by U.S. drug regulator supported Oil prices.

Moreover, the fire on a platform off Mexico earlier in the week halted about quarter of Mexico’s Oil output i.e. around 421,000 barrels per day of production.

However, demand worries for Oil persist as escalating worries over the wide spread of the delta variant led to increased restrictions across border affecting global supplies as well as demand.

Optimism over revival in Oil demand following the approval to the Pfizer Inc/BioNTech SE COVID-19 vaccine by U.S. drug regulator  and large production outage at Mexico following a fire on an oil platform is expected to continue supporting Crude prices.

However, worries over widespread of the Delta variant of the Covid19 virus might keep the prices in check.

Official US Crude inventory data due later in the day.

Base Metals

On Tuesday, Most Industrial metals on the LME as well as the MCX ended higher as widening impact of the pandemic lowered expectation of any early tightening of the monetary policy by US Federal Reserve.

Global central banks infusing liquidity in order to counter the pandemic led economic slowdown helped the Base metals recover from the record lows witnessed in the early months of 2020.

However, the Federal Reserve officials hinted towards withdrawing the stimulus measures in the policy meet held in July’21 following the solid recovery in the US economy which has kept the industrial metals under pressure.

Markets are expected to have a keen watch on the U.S. Federal Reserve symposium and key US economic data scheduled during this week for cues on the central bank’s stance in the coming months.

Copper

On Tuesday, Copper ended higher by 1.1 percent to close at $9376 per tonne as hopes over delay in tapering of the monetary policy by US FED supported prices.

Moreover, expectation of increased global demand for industrial metals with the shift towards a low carbon environment supported market sentiments.

Investors might remain cautious ahead of the U.S. central bank symposium scheduled later in the week for cues on the asset tapering timeline.

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