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Bullion Outlook

• Comex gold prices advanced more than 1.0% on Friday amid risk aversion in global markets and on higher-than-expected inflation data from the US

• The US annual inflation rate unexpectedly accelerated to 8.60% in May 2022 from 8.30% in the previous month, the highest since December 1981

• However, a sharp rise in US dollar index and rebound in US 10 year bond yields capped further gains in precious metal prices

• MCX gold prices are expected to trade with a positive bias due to concerns over elevated inflation and geopolitical uncertainty. It is trading above the resistance levels of 50 DMA (| 51,315). As long as it sustains above this level, it is expected to retest | 52,000 levels for the day. Silver prices are expected to take cues from gold prices and may move towards | 63,500 levels for the day

Base Metal Outlook

• MCX Copper and other industrial metal prices declined on Friday as investors feared the prospects of weak economic growth hitting metal demand after renewed Covid-19 lockdowns in China

• China's factory-gate inflation cooled to its slowest pace in 14 months in May, depressed by weak demand for steel, aluminium and other key industrial commodities due to tight Covid-19 curbs

• A group of indigenous Peruvian communities on Thursday agreed to temporarily lift a protest against MMG Ltd's Las Bambas copper mine that forced the company to halt operations for more than 50 days

• MCX copper prices are trading below the support levels of 50 DMA, which is around | 780. As long as it sustains below this level, it is likely to slip towards 200 DMA (| 762) levels in coming sessions

Energy Outlook

• WTI crude oil prices eased almost 1.0% on Friday after US consumer prices rose more than expected and China imposed new Covid-19 lockdown measures

• Additionally, US total rigs count increased to 580 from 574 over the last week, their highest since April 2020

• However, supply disruptions from Europe and Africa continued to support oil prices on the lower side. Oil output at Libya's Sarir field has been reduced after the ports of Ras Lanuf and Es Sider were closed and protesters threatened to close Hariga port

• MCX crude oil prices are expected to trade with a negative bias due to worries over lower fuel demand from China. It is facing resistance at +2 sigma levels of | 9,580. As long as it sustains below this level, it is likely to correct towards | 9,200 levels in the coming days

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