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Daily Commodities Outlook

Bullion Outlook

* Gold prices climbed on Thursday amid a decline in the US dollar index while investors positioned themselves ahead of key US inflation data and the Federal Reserve's policy meeting due next week

* However, sharp upside was prevented on a surge in US 10 year’s treasury yields

* Gold prices are expected to trade with a positive bias for the day amid weakness in dollar and on expectations that US Fed will remain less aggressive in raising interest rates from this month. Meanwhile, investors will remain cautious ahead of key economic data from the US as it could change the expectations around the terminal Fed fund rates, which currently lingers around 5%. MCX Gold prices are likely to surpass the hurdle of 54,200 to continue its upward trend towards the level of 54,300

* Additionally, MCX silver prices are expected to take cues from gold prices and trade towards 67,800 level

Base Metal Outlook

* Copper and other industrial metal prices advanced on Thursday on hopes that an easing of Coronavirus controls in top consumer China will increase demand

* However, sharp upside was capped as data showed that China's passenger vehicle sales fell for the first time in six months in November, which may dent demand for base metals

* Copper prices are expected to trade with a positive bias as China's Bank of Communications said it had signed pacts to support eight property firms, easing a liquidity crunch in the sector. Additionally, copper prices may rally on weakness in dollar and rise in risk appetite in the global markets. MCX copper prices are likely to break the key resistance level of 712 to continue its upward trend towards the level of 720 in coming trading sessions

Energy Outlook

* Crude oil prices tumbled yesterday as investors brushed aside the closure of a major Canada to US crude pipeline, focusing instead on concerns that global economic slowdown would hurt fuel demand

• Further, warnings of US recession in 2023 due to rising interest rates and inflation added downside pressure on prices

* Meanwhile, sharp downside was prevented after data showed Iraq produced 4.43 million barrels per day (bpd) of crude in November, down by 221,000 bpd from October

* Oil prices are likely to trade with a negative bias for the day as growing fears of recession and rising interest rates will erode the outlook for crude demand. Meanwhile, traders will closely watch US Baker Hughes total rig count data, which will provide more cues on future crude oil production in the US. Additionally, news that a Canada-to-US pipeline had shut and tankers were piling up in Turkey due to the price cap on Russian oil are expected to prevent further downside in prices

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