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Below are Quote On Gold rose on a softer Dollar whilst Base metals continued to remain under pressure by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd

Gold rose on a softer Dollar whilst Base metals continued to remain under pressure

Gold prices rose as the US Dollar weakened against the basket of currencies eased while Base metals were undermined following China’s attempting to contain the Commodity prices.

However, improving demand prospects following the robust recovery in global economies supported investor sentiments.

Gold

On Tuesday, Spot gold posted gains of about 1 percent to close at $1899.3 per ounce as the US Treasury yield and the Dollar scaled lower following the weak US economic data. A lower greenback makes the Dollar priced metals cheaper for other currency holders.

Also, the recent fall in the cryptocurrency, Bitcoin and prospects of rising physical demand from China further strengthened the yellow metal prices.

However, paced distribution of the vaccine raised bets on a speedy recovery in global economies boosting markets risk appetite which kept a lid on the yellow metal prices.

Moreover, US Federal Reserve officials understated inflation woes by stating that the current prices rally was triggered by the temporary optimism over reopening of economies. Weakening inflation concerns dented appeal for safe haven, Gold an inflation hedge.

Investors now wait for the key economic data like US GDP & jobless claims scheduled later this week for cues on the economic situation in the world’s largest economy. 

Crude Oil

In yesterday’s trading session, WTI Crude ended marginally higher by 0.03 percent to close at $66.1 per barrel as optimism over recovery in Oil demand kept prices elevated.

With major economies easing pandemic led restrictions and the massive vaccination programs around the globe increased expectations of a solid recovery in Oil demand downplaying worries of any possible supply glut led by resumption in Iranian Oil supply.

While reports suggested that the nuclear deal between US & Iran was less likely to go through in the near future which clouded the chances of return of Iranian exports in the global markets. However, if the deal is struck it can bring about 1 million to 2 million barrels per day (bpd) in additional oil supply to the global markets which kept investors cautious.

Increasing Covid19 infected cases in major Oil consumer India and prospects of weak demand from China continued to keep a lid on Oil prices.

Base Metals

In yesterday’s trading session, Industrial metals on the LME ended mixed with Zinc posting the highest gains amongst the pack. China set out to limit the soaring commodity prices continued to be a headwind for the industrial metals.

Copper and other Industrial metals erased some of its gains made earlier in the month after China vowed to increase scrutiny over the commodity market and launched severe punishments for excessive speculations and hoardings.

The move comes in following the persistent rise in the commodity prices which hampered the Chinese manufacturers and triggered potential inflation worries. Higher raw material prices drove China’s factory gate prices higher in April’21 whilst the industrial output grew at a slower than expected pace in a similar time frame. China also hiked margin for futures trading and margin fees in an attempt to ease the commodity prices.

However, bets on a low interest rate environment and Optimism over a paced economic recovery levied some support for the industrial metals.

Copper

LME Copper dipped about 0.3 percent to close at $9918 per tonne worries despite of a lower Dollar as China’s attempts to ease the commodity prices kept investors cautious.

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