Bullions counter may witness some short covering at lower levels as investors priced in a pause in interest rate hikes by the Federal Reserve at its policy meeting this week .
Bullions counter may witness some short covering at lower levels as investors priced in a pause in interest rate hikes by the Federal Reserve at its policy meeting this week, with a focus on the U.S. central bank’s rate outlook. Yellow metal can move in range of 58800-59300 while silver also can move in range of 72000-72600. Faster growth, cooler inflation and a job market that won’t quit have set the stage for an updated batch of forecasts from Fed officials this week, which is likely to reflect their growing faith in prospects for an economic soft landing. COMEX gold speculators cut net long position by 16,544 contracts in week ended Sept. 12, data showed on Friday. Chinese gold prices hit record highs last week, extending a months-long rally as consumers snap up the safe-haven asset to offset a depreciating yuan. Physical gold premiums also soared to new highs.
In base metal counter, Copper can move on weaker path as it can move in range of 730-740. Chile’s Codelco is ending long-term contracts to sell copper concentrate to Chinese clients from 2025, bidding to broaden its product offering to them after evaluating its production outlook. Zinc may remain on upside path as it can move in range of 220-228. Aluminum can move in range of 199-204. Domestic policies, like those concerning real estate, continue to progress, and measures to stimulate domestic demand are gradually being enacted. On a fundamental level, the growth rate of domestic aluminum supply is decelerating, import window is open, and the market’s overseas aluminum ingot supply is on the rise.
Crude oil may continue its rally as oil prices were buoyed by forecasts of a widening supply deficit in the fourth quarter after Saudi Arabia and Russia extended cuts and on optimism of a demand recovery in China, the world’s top crude importer. Overall it can move in range of 7520-7670. Brent and WTI have climbed for three consecutive weeks to touch their highest levels since November and are on track for their biggest quarterly increase since Russia’s invasion of Ukraine in the first quarter of 2022. The Saudi and Russian output cuts could push the market into a 2 million barrels per day (bpd) deficit in the fourth quarter, and a subsequent drawdown in inventories could leave the market exposed to further price spikes in 2024. Natural gas prices may move in range of 215-225.
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