Bullion are trading sideways showing a volatile session after the news came in that International Monetary Fund (IMF) has sold 200 tonnes of Gold to Reserve bank of India (RBI) for $6.7 billion, which surprised traders who expected China to be the leading buyer.
Spot gold prices rose about $6 to more than $1,066 an ounce on Tuesday, just below the the last month's $1,072 record high, aided primarily by a falling U.S. dollar. The IMF news could add to the market's upward momentum. The positive array of economic data releases is also supporting the markets and in turn pushing Gold up too- making it behave like a risky asset.
Crude struggled to surpass $79 and showed a range bound movement today. Oil prices remained toned down as U.S. crude-oil inventories probably rose as imports and refinery utilization increased. A Reuters poll of analysts forecast weekly U.S. inventory data for the week to October 30 would show a 1.5 million-barrel build in crude stockpiles, a 500,000- barrel draw in distillates and a 300,000-barrel rise in gasoline inventories. Energy traders have closely watched economic data and equities markets this year for signs of a turnaround in the economic crisis that could bolster flagging oil demand.
Base metals tumbled in tandem after taking cues from equity markets. Yesterday’s gains were capped due to build up in LME warehouse stock showing concerns over demand. Base metals dipped on concern over possible withdrawal of stimulus measures outweighed better-than-expected manufacturing data in China and the U.S., the world’s two largest consumers of the metal.
Courtesy: Religare Commodities
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