Home Markets Spot Gold ended higher by 0.6 percent to close at $1774.2 per ounce

Spot Gold ended higher by 0.6 percent to close at $1774.2 per ounce

by Prathamesh Mallya (AVP- Research, Non-Agri Commodities and Currencies, Angel Broking Ltd)
Sep 22, 2021
Spot Gold ended higher by 0.6 percent to close at $1774.2 per ounce, Market, KonexioNetwork.com

Gold


On Tuesday, Spot Gold ended higher by 0.6 percent to close at $1774.2 per ounce. Spot gold extended gains from the previous session as the Dollar weakened ahead of the outcome of the two day US policy meet.


Moreover, mounting worries over the impact of China’s property developer Evergrande's debt crisis on the global economy further weighed on market sentiments and in turn support Gold prices.


Gold prices remained under pressure last week as better than expected US economic data before the Federal Open Market Committee meet scheduled on 21st & 22nd September 2021 increased bets towards a hawkish approach by the US Central bank.


Gold which is widely considered a hedge against inflation and currency debasement might feel some pressure if the US FED hint towards tightening of the monetary policy.




Uncertainties over the US central banks stance in the months ahead is expected to keep the market cautious and Gold prices steady. Any Hawkish comments by the US FED chair Jerome Powell in the two-day meet which begins today will weigh on Gold prices.



 

Crude Oil



On Tuesday, WTI Crude gained about 0.4 percent to close at $70.6 per barrel as tighter supply worries outpaced the global uncertainties and underpinned Oil prices.


Also, reports stating that some of the Oil producing units in the Gulf of Mexico are expected to remain offline until the end of this year due to damage from Hurricane Ida further hinted towards a tighter Oil supply from US.


Moreover, the US Currency eased making the Dollar priced Oil more desirable for other currency holders.


Oil priced ended lower on Monday as fears over Chinese property developer Evergrande's solvency issues sent a panic wave across financial markets and undermining the demand outlook.



 Markets are expected to remain cautious ahead of the US Federal Reserve policy meet which begins today for cues on their monetary stance in the months ahead.



 

Base Metals



On Tuesday, Industrial metals on the LME & MCX extended the fall from the previous session as fears of debt default by China property developer Evergrande Group undermined sentiments.


Mounting fears over prospects of debt default by Chinese property developer Evergrande Group sent a panic wave across financial markets. Investors rushed towards the safe haven Dollar following worries over probable impact on the global economy amid the wide spread of the Delta Variant.


Debt fears come in line with the slow expansion in China’s economy following the recent outbreaks of the virus and disrupted supply which triggered the fall in industrial metal prices.


Markets are expected to remain cautious ahead of the outcome of the two-day Federal Open Market Committee meet. Any Hawkish comments by the US FED chair Jerome Powell might further strengthen the Dollar.


Copper


On Tuesday, LME Copper ended lower by 0.64 percent to close at $8975.5 per tonne as prospects of default by Chinese property developer amid slow expansion in China’s factory activity pressured Copper and other industrial metals.


Easing worries over Evergrande Crisis and worries of potential Shortage in the global markets might support industrial metal prices.