Bullions counter can extend its gains as a softer dollar and prospects of slower interest rate hikes by the U.S. Federal Reserve boosted bullion’s appeal. Gold can move in range of 56500-56900 while Silver also can move in range of 68500-69400. It is expected that U.S. central bank to slow the pace of its rate increases at the Jan. 31-Feb. 1 policy meeting to 25 basis points, even though some Fed officials have signalled that their battle against inflation is far from over.
Bullions counter can extend its gains as a softer dollar and prospects of slower interest rate hikes by the U.S. Federal Reserve boosted bullion’s appeal. Gold can move in range of 56500-56900 while Silver also can move in range of 68500-69400. It is expected that U.S. central bank to slow the pace of its rate increases at the Jan. 31-Feb. 1 policy meeting to 25 basis points, even though some Fed officials have signalled that their battle against inflation is far from over. The Fed raised rates by 50 bps last month after delivering four straight 75-bp hikes. European Central Bank would be more aggressive than previously thought in its tightening campaign, adding another 50 bps to its deposit rate on Feb. 2, as it continued its fight against rampant inflation.
In base metal counter, Copper can trade on upside path as it can move in range of 772-785. IMF president said that the consecutive downgrades of global economic growth expectations are over, and global economic growth will bottom out by the end of 2023. In China, the GDP exceeded 120 trillion yuan in 2022, up 3%. In the fourth quarter of 2022, the GDP added 2.9% year-on-year, higher better than the average market expectation of 1.9%. LME copper prices surged as the higher proportion of LME cancelled warrants intensified the overseas supply tightness. Zinc may move on firm path as it can move in range of 290-300. Aluminum can trade on upside path as it can move range of 220-227.
ENERGY: Crude oil may continue to trade higher as it can test 6700 while taking support near 6500. Crude oil hold on to most of last week’s gains on the prospect of an economic recovery in top oil importer China this year. International Energy Agency head Fatih Birol on Friday said energy markets could tighten this year if the Chinese economy rebounds the way financial institutions expect. The jump in China’s traffic ahead of the Lunar New Year holiday bodes well for fuel demand after the two-week vacation. The European Union and Group of Seven (G7) coalition will cap prices of Russian refined products starting on Feb. 5, in addition to their price cap on Russian crude in place since December and an EU embargo on imports of Russian crude by sea. Natural gas prices can witness lower level buying as it can move in range of 260-285.
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