Bullions counter may witness some short covering as yellow metal edged higher in early Asian trade on Monday, helped by a weaker U.S. dollar, although chances of more interest rate hikes by the Federal Reserve this year to tame sticky inflation weighed on bullion’s appeal. Gold can move in range of 58200-58600 while silver also can move in range of 68600-69500.
Bullions counter may witness some short covering as yellow metal edged higher in early Asian trade on Monday, helped by a weaker U.S. dollar, although chances of more interest rate hikes by the Federal Reserve this year to tame sticky inflation weighed on bullion’s appeal. Gold can move in range of 58200-58600 while silver also can move in range of 68600-69500. In his congressional testimony last week, Fed Chair Jerome Powell signalled more rate hikes ahead but vowed the central bank would proceed with caution. Investors now expect a 72% chance of a rate hike in July, with rate cuts seen from 2024 onwards. U.S. business activity fell to a three-month low in June as services growth eased for the first time this year, yet economic growth ticked up a notch in the second quarter.
In base metal counter, Copper can trade in green as it can move in range of 715-725. Copper stocks in the LME-registered warehouses continued to decline, the exchange’s daily data showed on Friday, with headline inventory falling to a one-month low of 79,300 tonnes after 1,100 metric tons of outflows. Making dollar-priced commodities less attractive to holders of other currencies, the dollar rose as the risk of higher rates triggering an economic downturn pushed some investors to seek safe-haven assets –including the US currency. Zinc may remain on sideways path as it can move in range of 210-216. Aluminum can trade subdued path in range of 196-204.
ENERGY: Crude oil may witness mixed movement as it can move in range of 5640-5760. Both Brent and WTI fell about 3.6% last week on worries that further interest rate hikes by the U.S. Federal Reserve could sap oil demand at a time when China’s economic recovery has also disappointed investors after several months of softer-than-expected consumption, production and property market data. A clash between Moscow and Russian mercenary group Wagner was averted on Saturday after the heavily armed mercenaries withdrew from the southern Russian city of Rostov under a deal that halted their rapid advance on the capital. Natural gas prices (Jul) may trade on upside path as it can move in range of 230-240.
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