Bullions counter may trade on weaker path as investors awaited cues from the U.S. Federal Reserve after the Bank of Canada hiked its rates to a 22-year high. Gold can move in range of 59300-59800 while silver also can move in range of 71300-72200.
Bullions counter may trade on weaker path as investors awaited cues from the U.S. Federal Reserve after the Bank of Canada hiked its rates to a 22-year high. Gold can move in range of 59300-59800 while silver also can move in range of 71300-72200. The Bank of Canada on Wednesday hiked its overnight rate to a 22-year high of 4.75%, and markets and analysts immediately forecast yet another increase next month to ratchet down an overheating economy and stubbornly high inflation. The U.S. economy is strong amid robust consumer spending but some areas are slowing down, U.S. Treasury Secretary Janet Yellen said, adding that she expects continued progress in bringing inflation down over the next two years. U.S. consumer inflation report for May, due on June 13, ahead of the Fed meeting, will provide investors with more clarity about the health of the world’s largest economy.
In base metal counter, Copper can trade with mixed bias in range of 716-725. Markets were awaiting next week’s inflation data which will gauge the path ahead of the Fed’s rate hike meeting. In terms of fundamentals, import losses continued to expand. It is expected that the inflow of imported goods in the market will be limited, and smelters will conduct concentrated maintenance in June. Copper prices are expected to remain range bound before the announcement of the Fed’s rate decision. Zinc may remain on volatile path as it can move in range of 210-217. Aluminum can trade on weaker path in range of 202-206. On the demand side, downstream consumption has gradually entered the off-season. However, due to the high proportion of molten aluminium output at smelters, aluminium ingot social inventories continue to drop.
ENERGY: Crude oil may move sideways in range of 5920-6050. Oil prices climbed about 1% on Wednesday as Saudi Arabia’s plans for deep output cuts more than offset demand woes stemming from rising U.S. fuel stocks and weak Chinese export data. U.S. crude stocks fell by about 450,000, according to data from the Energy Information Administration, compared with estimates for a 1 million build. Diesel inventories rose by 5.1 million barrels, while markets had estimated a build of 1.33 million. Gasoline inventories also rose more-than-expected at 2.8 million barrels, compared with estimates for a build of 880,000 barrels. The unexpected build in fuel inventories raised concerns over consumption by the world’s top oil user, especially as travel demand grew during the Memorial Day weekend. Natural gas prices may witness lower level buying as it can move in range of 185-198.
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