Commodity Article : Gold bounces back, Crude gains over 2 percent Says Prathamesh Mallya, Angel One

Below is Daily Commodity Article by Mr. Prathamesh Mallya, AVP- Research, Non-Agri Commodities, and Currencies, Angel One Ltd

Gold bounces back, Crude gains over 2 percent.


Gold prices on Tuesday were back in the hunt, as the yellow metal climbed above the $2000 mark. 

Investors are now looking for clues as to how near interest rates are to peak in vital US inflation data that will be released later in the day.

Bets that the Fed will increase interest rates next month have been reinforced by a good US employment report from last week. 

The markets are pricing a 25 basis-point raise with a nearly 70% possibility, according to the CME Fedwatch tool.


Outlook: Gold prices are expected to remain high, as the US Fed is expected to slowdown on its rate hike path.



Crude prices were back in the positive territory, as both the beanchmark indices Brent and NYMEX ended on a higher note. 

Despite surprising increases in US crude and gasoline stockpiles shown by the industry data, which offset concerns about a tighter market ahead of OPEC+ cutting their output, crude managed to hold onto its gains.

Ahead the release of US consumer pricing data, prices had climbed by roughly 2% in anticipation that the Federal Reserve could ease off on its tightening of monetary policy.


Outlook: We expect crude to trade higher towards 6820 levels, a break of which could prompt the price to move higher to 6930 levels.




On Tuesday, the base metals pack ended on a mixed note, with Copper and Nickel managing to end higher, while rest of the metals slipped lower. 

Stronger-than-anticipated data on Chinese credit growth helped to support copper prices on Wednesday, but increased metal supply and cautious sentiment ahead of important US inflation data weighed on the market.

Due to newly created capacity and a sufficient supply of raw materials, China's refined copper output in March increased 14% from a year earlier, according to state-backed research company Antaike.

After Peru announced earlier this week that it would increase its copper production by 15% this year to 2.8 million tonnes, fears about copper production around the world have subsided.


Outlook: We expect copper to trade lower towards 769 levels, a break of which could prompt the price to move lower to 764 levels.


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