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Surge successful lipid prices and a firmer US Dollar Index proceed to measurement connected gold. (AI image)
Gold terms prediction today: Gold prices volition proceed to instrumentality cues from crude lipid prices, says Praveen Singh, Head Currencies and Commodities, Mirae Asset ShareKhan.Gold Performance:
- Surge successful lipid prices and a firmer US Dollar Index proceed to measurement connected the gold. In fact, moves successful lipid are dictating moves successful astir of the commodities including gold.
- The yellowish metallic closed with a nonaccomplishment of 1.2% astatine $5019 connected March 13, which amounted to a play nonaccomplishment of astir 3% -- Its 2nd consecutive play loss—as the much-derided US Dollar took a peek supra the important 100-mark for the archetypal clip since November 25.
- The US Dollar and crude lipid are giving stiff contention to golden arsenic caller harmless havens arsenic the Middle East warfare rages.
- At the clip of penning this article, spot golden was changing hands astatine $4995, down astir 0.5% for the time connected March 16. The MCX April golden declaration astatine Rs 157,794 was down by 1.69%.
Geopolitics and lipid Watch:
- On Monday, the US Dollar Index see-sawed with crude lipid prices. Oil is highly volatile with traders reacting to shifting possibilities of the lipid travel disruption strength arsenic the Strait of Hormuz remains practically closed amid uncertainty implicit the duration of the raging war.
- Oil prices slumped connected Monday pursuing a rally to $100+ level, which led the Dollar Index lower.
- Iran struck caller targets crossed the Persian Gulf, including a cardinal United Arab Emirates lipid hub, which caused the UAE oil-export terminal of Fujairah to suspend loadings temporarily.
- The US President Trump called connected satellite powers to nonstop warships to supply escorts to commercialized vessels, but nations are cautious successful their response.
- IEA’s coordinated plan: Countries successful Asia person committed to merchandise implicit 100 cardinal barrels; a akin magnitude is to beryllium released successful Europe, portion the US intends to merchandise 170 cardinal barrels.
ETF and COMEX inventory:
- As of February 13, full known planetary ETF holdings stood astatine 99.73 MOz, up by astir 0.78 MOz YTD. It is to beryllium noted that golden ETF holdings person fallen 8 retired of 10 days since the Iran warfare began connected February 28. Since then, holdings are down by astir 1.19 MOz.
- Registered COMEX golden inventory astatine 16.69 MOz has fallen to the lowest level since February 14, 2025, and is down by implicit 31% from the grounds highest of 24.25 MOz seen successful April 2025 -- 'Liberation Day' tariff episode.
Data roundup:
- US information released connected Monday were mixed: empire manufacturing Index fell to -0.2 successful March from 7.1 successful Feb; concern accumulation roseate to 0.2% successful February Vs the estimation of 0.1%; NAHB lodging scale astatine 38 successful March bushed the forecast of 37.
- US information released connected Friday were somewhat mixed arsenic annualized Q4 GDP came successful astatine 0.7% (forecast 1.4%); Core PCE terms scale was up 0.4% m-o-m successful January (forecast 0.4%), portion the Index roseate 3.1% y-o-y (forecast 3.1%). Real idiosyncratic spending was up by 0.1% successful January (forecast 0%). University of Michigan user sentiment fell from 56.6 to 55.5 (prel. March reading), though the information bushed the estimation of 54.80 arsenic some short-term and semipermanent ostentation expectations eased. JOLTs occupation openings roseate from 6550K successful December to 6946K successful January Vs the estimation of 6750K jobs.
US Dollar Index and yields:
- The US Dollar Index closed with a regular summation of 0.62% astatine 100.36 connected Friday, frankincense posting a play summation of astir 1.36%.
- Two-year US yields astatine 3.73%-- highest since August 202-- were up by astir 5% for the week, portion Ten-year yields astatine 4.28% were up by astir 3.5%
- The Index, astatine the clip of penning this report, was hovering astir 99.82, down by astir 0.5%.
- Two-year US yields astatine 3.69% were down implicit 1%, portion ten-year yields astatine 4.22% were down by 1.33%
Rate bets:
- Despite a dismal Feb. nonfarm payroll report, investors present look for somewhat much than 1 Fed complaint chopped this twelvemonth arsenic lipid prices person surged stoking inflationary concerns.
- The contiguous complaint pricing is successful crisp opposition to the expectations of somewhat much than 2 complaint cuts seen a fewer weeks ago.
- Some of the ECB officials are of the sentiment that the Central Bank whitethorn beryllium forced to hike rates sooner than expected owed to ostentation hazard successful the Middle East war.
CTFC data:
- Money managers person accrued their bullish golden bets by 1,381 net-long positions to 102,236 successful the week ending March 10.
- The net-long presumption was the astir bullish successful six weeks Long-only positions roseate 2,126 tons to 126,132 lots. The long-only full was the highest successful six weeks Short-only positions roseate 745 tons to 23,896 -- the highest successful 3 weeks.
India's golden and metallic concern request falls:
- India's commercialized shortage narrowed to $27.1 cardinal successful February from $34.7 cardinal successful January, driven by a pullback successful golden imports. Total imports eased to $63.7 cardinal successful February from $71.2 cardinal successful January, led by a slump successful golden and metallic imports.
- Gold and metallic imports fell to $9.1 cardinal from $14.1 cardinal arsenic concern request eased pursuing the terms correction from end-January peaks.
- Net inflows into ETFs of these precious metals dropped to 44.3 cardinal rupees from 335.0 cardinal rupees successful January.
Central slope watch:
- The US FOMC volition present its monetary argumentation determination connected March 18. The Committee is expected to support the overnight Fed Fund complaint unchanged astatine 3.50-3.75%.
- Bank of Japan is expected to support the benchmark complaint unchanged astatine 0.75% successful its monetary argumentation determination owed connected March 19.
- The Bank of England is apt to alteration its cardinal argumentation complaint unchanged astatine 3.75% successful its gathering connected March 19.
- Similarly, the ECB is expected to support the main refinancing complaint astatine 2.15% successful its monetary argumentation determination owed connected March 19.
Upcoming data:
- Key US information connected the platform this week see Feb. PPI (March 18), January full nett TIC flows and Philadelphia Business outlook (March 19).
Gold Price Outlook:
- In the abbreviated term, golden and different commodities are expected to instrumentality cues from crude oil. The US Dollar Index tin emergence to 102 level connected US's vigor independency and risks to the lipid importing nations including EMs and Europe.
- Rising likelihood of less Fed complaint cuts volition measurement connected commodities. Gold is inactive expected to bash amended than astir of the commodities, particularly metals.
- Gold whitethorn trial enactment astatine $4840 arsenic the Dollar Index tin emergence further connected reduced complaint chopped probability. Resistance is astatine $5250/$5450.
(Disclaimer: Recommendations and views connected the banal market, different plus classes oregon idiosyncratic concern absorption tips fixed by experts are their own. These opinions bash not correspond the views of The Times of India)
