In the previous week, all base metals including
Aluminum (-1.5%), Copper (-4.2%), Lead (-4.4%) and Zinc (-2.9%) closed in red,
snapping its three weeks’ winning streak, with bears taking over the control of
commodities’ market. Iron ore stood out of the pack, gaining by 2.6% during the
week. Precious metals, gold and silver also kept retreating during the whole
week, losing 3.9% and 5% respectively.
Gold and silver have been experiencing a
bloodbath since the announcement of Union Budget 2021. Both the precious metals
has been continuously witnessing a selling pressure, weighed by the growth
outlook, which is becoming optimistic for the global economy. Alongside, with
the interest rate also getting stagnant, investors have started exiting their
positions in bullion markets and are diversifying their investments in better
opportunities, which has triggered a fall in the bullion prices.
International Crude oil prices rallied last
week, after OPEC and its allies ignored India’s plea to ease production
control, with Saudi Arabia asking New Delhi to instead use oil it bought at cheap
rates last year. OPEC plus nations agreed to keep output quota unchanged in
April, when the market was expecting some ease in output cuts of around 1.5 MB
per day. Crude oil prices are expected to trade in sideways to positive trend
in the current week. However, the traders needs to keep an eye on the crude oil
inventories data, which will be released on 10th March.
For the current week, we expect gold and silver
to trade in sideways to negative momentum, as the Federal Reserve Chairman,
Jerome Powell failed to reassure investors that central bank policymakers would
keep surging bond yields and inflation expectations under control. Along with
this, the investors also need to keep a watch on some important economic data
such as Europe’s and UK’s GDP, Europe’s PPI and US’ PPI.
For the week, we expect gold in COMEX market to be in the range of $1,603 to $1,750, while silver is expected to be in the range of $24.7 to $27.1. Whereas, for bullion market traders, we assume gold futures to trade in the range of 43,268 – 42,997 to 46,876 – 47,012.