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Below are Views On Spot gold ended marginally lower by 0.15 percent to close at $1754.1 per ounce By Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities and Currencies, Angel One Ltd 

Resumption in economic activities underpin Base metals and Crude

Gold

On Monday, Spot gold ended marginally lower by 0.15 percent to close at $1754.1 per ounce. The bullion metal remained steady on the first trading day of the week as worries over possible stagflation overshadowed a stronger Dollar.

However, the Dollar continued to gain strength on bets over tapering of the asset purchase program by US Federal Reserve which limited the gains for Gold.

A hawkish monetary approach which would lead to higher interest rates has clouded the outlook for the non-interest bearing Gold.

Also, increasing Oil prices following bets over resumption in global economic activities boosted markets risk appetite which further pressured the safe haven Gold.

Gold might remain under pressure as the Dollar remains steady on expectation of a tighter monetary policy by the US Central bank.

Crude Oil

On Monday, WTI Crude rose over 3 percent to close at $82 per barrel whereas MCX Crude prices surged over 4 percent closing at Rs.6186 per barrel. Oil extended gains from the earlier week and touched record levels following revival in global demand amid tight supply.

Mounting supply concerns following the resumption in global economies and revival in markets risk appetite have been supporting Oil prices since last week.

OPEC and its allies vowing to stick with its scheduled expansion in production activities and US Energy Department not willing to release Oil from the emergency crude reserves despite escalating shortage concerns further underpinned Oil prices,

The gains for Crude were capped as appreciation in the US Dollar made the Dollar denominated Oil less desirable for other currency holders.

Rising fuel demand given the recovery in economic activities amid tighter Oil supply and increasing natural gas prices might keep prices elevated.

Base Metals

Industrial metals traded higher on the LME & MCX during the week despite a stronger Dollar as depleting inventories across exchanges and revival in markets risk appetite supported sentiments.

Supply threats for Aluminium continued to intensify as along with the stern environmental norms, revival in global demand triggered a shortage of energy in China which further hampered the operational activities at key smelting capacities. Potential supply shortage in line with rise in global needs pushed Aluminium prices higher.

The gains for Industrial metals were capped as worries over growth in China’s property sector following Evergrande’s debt troubles amid disrupted industrial activities hinted towards instability in the world’s largest metal consuming economy.

Also, a stronger US Dollar following expectation of a hawkish stance by the US Central bank made the Dollar priced metals less desirable for other currency holders.

Copper

LME Copper ended higher by 1.3 percent on Monday  to close at $9484 per tonne reflecting the potential shortage worries as many nations witness power outage.

Despite concerns in China’s property markets, industrial metals might continue to trade higher following resumption in global economic activities amid potential shortage concerns.

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