Bullions counter can witness selling pressure at higher levels as investors weighed the chances of the U.S. Federal Reserve slowing its pace of interest rate hikes, while a firmer dollar capped bullion’s gains. Gold can move in range of 56100-56500 while Silver also can move in range of 67300-68600.
Bullions counter can witness selling pressure at higher levels as investors weighed the chances of the U.S. Federal Reserve slowing its pace of interest rate hikes, while a firmer dollar capped bullion’s gains. Gold can move in range of 56100-56500 while Silver also can move in range of 67300-68600. Few Fed officials signalled on Wednesday that they would push on with more interest rate hikes, while Philadelphia Fed President Patrick Harker and Dallas Fed President Lorie Logan said they supported a slower pace of tightening. Traders are mostly pricing in a 25-basis point rate hike at the Fed’s Jan. 31-Feb. 1 meeting. Last year, the U.S. central bank slowed its pace of hikes to 50 bps in December after four straight 75-bp increases. Data on Wednesday showed U.S. producer prices fell more than expected in December, offering more evidence that inflation was receding, while retail sales fell by the most in a year, putting consumer spending and the overall economy on a weaker growth path heading into 2023.
In base metal counter, Copper can trade lower as it can move in range of 760-775. On the fundamentals, the copper cathode inventory in Guangdong rose for four consecutive days and was now above 20,000 mt, and is expected to accumulate further mainly due to mounting arrivals and falling demand. On the other hand, imminent Chinese New Year (CNY) holiday made the market extremely quiet, except for a few traders. On the consumption side, almost all terminal fabricators and terminal players are in holiday, weighing on the demand. SHFE copper is expected to move rangebound amid the current macro sentiment. Zinc may move on firm path as it can move in range of 284-295. Aluminum can trade on upside path as it can move range of 218-226.
ENERGY: Crude oil may continue to trade lower as it can test 6250 while taking resistance near 6450. Oil futures fell over recession fears as a sharp decline in U.S. retail sales and manufacturing output muddied the outlook for demand, while industry data showing a surprise jump in U.S. crude stocks also weighed on prices. U.S. December retail sales fell by the most in a year, weighed by declines in purchases of motor vehicles and a range of other goods, putting consumer spending and the overall economy on a weaker growth path heading into 2023. The API report was delayed by a day due to Monday’s Martin Luther King Day public holiday in the United States. The government’s Energy Information Administration will release its weekly inventory report on Thursday. Natural gas prices can trade further lower as it can move in range of 250-285.
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