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Below are Views On Spot Gold prices might remain steady ahead of the Powell's speech at the Fed's annual economic symposium 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 Gold remained steady ahead of US FED Chair Jerome Powell speech later in the week.

Gold

On Wednesday, Spot Gold slipped below the 1800 level as the US Currency held on to its gains which weighed on the Dollar priced Bullions.

Also, Investors remained cautious ahead of the U.S. Federal Reserve's symposium scheduled later in the week. Markets will have a keen eye on FED Chair Jerome Powell’s speech on 27th August for cues on their stance in the coming months.

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.

Spot Gold prices might remain steady 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 Wednesday, WTI Crude prices eased after a two-day rally as the Oil production in Mexico was set to resume after the recent fire.

Further supporting Oil prices was the larger than expected withdrawal of the US Crude inventories last week. As per reports from the U.S. Energy Information Administration, Crude inventories dipped over 3 million barrels surpassing the market expectation of a 1.9 million barrel drop.

Oil prices surged earlier in the week following bets over revival in global demand amid fire cutting near Mexico’s quarter Oil production. The approval to the Pfizer Inc/BioNTech SE COVID-19 vaccine by U.S. drug regulator supported market sentiments.

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.

Looming worries over widespread of the Delta variant of the Covid19 virus and resumption in Mexican Oil production might weigh on Oil prices.

Base Metals

On Wednesday, Industrial metals remained steady ahead of the U.S. Federal Reserve symposium for cues on the stance in the coming months. 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.

Alumina prices rose to its highest in about 6 months following a fire at the Jamalco refinery in Jamaica which ignited worries of tighter supply of the Aluminium raw material. The Jamalco plant can produce up to 1.4 million tonnes per year of alumina, which is refined from bauxite. Global alumina production in 2020 was 134.4 million tonnes, according to the International Aluminium Institute.

Worries over shortage of primary raw material amid disrupted supply of Aluminium from major producing nation China might continue to support Aluminium prices in the near term.

Copper

On Wednesday, Copper remained under pressure as easing supply worries pressured the prices. The Chilean miner Codelco, the world's largest copper producer, reached agreement on a new contract with supervisors at its Andina mine. Andina produced 184,000 tonnes of copper in 2020, around 10% of Codelco's total output.

The Global Copper supply chain has remained under pressure in the past few months as the labor unions demanded for addition compensations in wake of the covid19 virus and record high Copper prices. Mounting supply worries from major Copper producing nation Chile amid prospects of increase in demand for industrial metals kept Copper prices elevated.

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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