Precious Metals Edge Lower on Dollar Strength

Spot gold prices declined around 0.3 percent on Monday, on account of dollar strength, as a stronger dollar makes dollardenominated commodities look cheaper for the holders of the other currencies.

Additionally, fall in crude oil prices affected the inflation-led demand for gold which also acted as a negative for gold.

The yellow metal touched an intra-day low of $1711/oz and ended its trading session at the level of $1719/oz yesterday.

However, MCX Gold April contract witnessed gains of around 0.8 percent on Monday on the back of a weaker Rupee and touched an intra-day high of Rs28,030/10 gms.

Silver

Silver prices rose slightly by 0.1 percent in yesterday’s trading session and touched an intra-day high of $33.84/oz.

However, sharp gains were capped due to dollar strength and fall in gold prices. The white metal closed its trading session at the level of $33.60/oz on Monday.

MCX Silver March contract rose around by 0.5 percent yesterday on the back of depreciation in the Indian Rupee.

The white metal touched an intra-day high of Rs56,539 and ended at the level of Rs56,426/kg on Monday.

Base Metals Settle Lower On Euro Economic Worries

The base metals pack traded lower on the LME on Monday, with nickel being an exception.

Strength in the US dollar coupled with weak sentiments in the global markets due to deepening concerns with respect to Euro Zone debt worries exerted downside pressure on metal prices.

However, depreciation in the Indian Rupee (INR) resisted sharp decline on the domestic bourses in yesterday’s trading session.

The INR depreciated almost 1 percent and closed at above thelevel of 49-mark on Monday.

Copper

Copper, the leader of the base metals complex, declined around 1 percent on the LME and by 0.2 percent on the MCX on Monday.

Weak demand from China, the world’s largest metal consumer, a stronger dollar and rising Euro Zone debt tensions exerted pressure on the red metal prices.

Copper touched an intra-day low of $8427.50/tonne and closed at $8510/tonne yesterday.

On the MCX, Copper February contract touched an intra-day low of Rs416.70/kg and ended its trading session at the level of Rs418.9/kg on Monday.

Crude Oil Weighs Down On Greek Debt Concerns

Nymex crude oil prices declined by 1 percent on Monday, taking cues from rising Greece debt concerns coupled with a stronger dollar.

Additionally, rise in risk aversion in the markets also acted as a negative factor for the commodity.

Prices touched an intra-day low of $96.38/bbl and closed at $96.90/bbl yesterday.

On the MCX, crude oil prices increased by 0.7 percent on account of Rupee depreciation and touched an intra-day high of Rs.4803/bbl on Monday.

API Inventories Forecast

The American Petroleum Institute (API) is scheduled to release its weekly inventories today and US crude oil inventories are expected to increase by 2.6 million barrels for the week ending on 3rd February 2012.

Gasoline stocks are expected to increase by 0.2 million barrels and distillate inventories are expected to decline by 0.6 million barrels for the same week.



crude oil weighs down on greek debt concerns