Bullions counter may trade in range as traders weighed recent U.S. economic data and hawkish signals from the Federal Reserve, while a relatively softer dollar provided some support to bullion. Gold can move in range of 59000-59500 while silver also can move in range of 71500-73000.
Bullions counter may trade in range as traders weighed recent U.S. economic data and hawkish signals from the Federal Reserve, while a relatively softer dollar provided some support to bullion. Gold can move in range of 59000-59500 while silver also can move in range of 71500-73000. Bullion tumbled to a three-month low on Thursday before reversing course to finish higher after U.S. economic data offered some respite from the Fed’s “hawkish pause” on rate hikes. While gold is considered a safe haven during economic uncertainties, higher interest rates dull the appeal for zero-yield bullion. Traders are now pricing in a 72% chance of a 25-basis point rate hike in July, after the Fed signalled in new projections that borrowing costs might still need to rise by as much as half a percentage point by year-end. The dollar index held close to a one-month low, making gold less expensive for buyers holding other currencies.
In base metal counter, Copper can trade on lower path as it can move in range of 725-735. On the macro front, the European Central Bank raised interest rates for the eighth time in a row and signalled further tightening to bring the inflation rate in the eurozone to the medium-term target of 2%. In south China, due to the widening price spread between the SHFE front-month and next-month copper contracts, downstream buying interest was weak. Zinc may remain on subdued path as it can move in range of 220-230. Aluminum can trade sideways in range of 203-207.
ENERGY: Crude oil may remain on volatile path in range of 5600-5850. Oil prices were set to snap a two-week losing streak despite trading marginally lower early on Friday, amid optimism about higher energy demand from top crude importer China and a weaker dollar. Data on Thursday showed China’s oil refinery throughput rose 15.4% in May from a year earlier, hitting its second-highest total on record. Chinese demand for oil is expected to keep climbing at an assured rate during the second half of the year, Kuwait Petroleum Corp’s CEO said. Analysts also expect voluntary crude output cuts implemented in May by the Organization of the Petroleum Exporting Countries and its allies, and by Saudi Arabia in July, to support prices. Natural gas prices may trade with upside bias as it can move in range of 202-215.
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