Gold prices fell as the dollar strengthened ahead of a
Fed’s meeting at which the U.S. central bank is expected to raise interest
rates for the first time this year - Gold on MCX settled down -0.51% at 30263 as bond yields rose,
supporting an advance in the dollar, lessening demand for the yellow metal as
the FOMC meeting got underway, a day ahead of a widely expected interest rate
hike. Current investor expectations are for three 0.25% rate hikes total 2018,
which would leave the Fed’s benchmark rate at range of 2.00% to 2.25% by
year-end. That could change on Wednesday, however, with the release of the
FOMC\'s Summary of Economy Projections which will include the closely watched
“dot plots,” showing where each FOMC member in the meeting thinks that interest
rates are heading at the end of the year for the next few years and in the
longer run.
Zinc prices dropped as pressure
seen as rising inventories highlighted healthy supplies - Zinc on MCX settled down -1.45% at
210.10 in the line of expectation tracking weakness from LME benchmark zinc
fell 1.8 percent to finish at $3,203 a tonne as pressure seen after LME zinc
stocks have shot up by 60 percent this month, climbing by another 5,350 tonnes
on Tuesday to 211,400 tonnes. Higher zinc prices have helped miners' profit
margins, and this should work as an incentive to miners to speed up their
pipeline of projects or restart idled operations. Traders are also watching
treatment charges for zinc concentrate. Sliding treatment charges suggest less
availability of concentrate, while a rising number would mean surpluses.
Copper dropped as pressure after
data showed LME copper inventories grew by a further to 322,475 tonnes,
bringing the gain this year to 61 percent -Copper on MCX settled down -1.22% at 441.25 as
pressure after data showed LME copper inventories grew by a further to 322,475
tonnes, bringing the gain this year to 61 percent. Concern about trade wars,
higher U.S. interest rates and a stronger dollar also weighed on industrial
metals markets. Fears of a global trade war mounted after U.S. President Donald
Trump imposed hefty import tariffs on steel and aluminium and, according to sources,
the US is set to unveil new tariffs specifically targeting China by the end of
this week.
Oil Prices Continue To Rise On Middle East Tension
- Oil prices continued to climb on Wednesday morning in Asia amid tensions
in the Middle East.Saudi Arabia’s Crown Prince Mohammed bin Salman arrived in
Washington on Tuesday for a state visit, raising speculation for an agenda to
ramp up pressure on Iran. Following renewed criticism of the 2015 nuclear deal,
the U.S. could reimpose sanctions on Iran, a concern that has lifted oil
prices.The nomination of Mike Pompeo as new U.S. Secretary of State also raises
the likelihood of oil trade disruptions, given he fiercely opposed the 2015
pact as a member of Congress.
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