India Base Metals
Most rise on US Fed rate cut hope, weak dollar
This story was originally published at 18:18 IST on 18 September 2024
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By Ashutosh Pati
MUMBAI – Futures contracts of most base metals rose today on the Multi Commodity Exchange of India and the London Metal Exchange on expectations that a cut in interest rate by the US Federal Reserve, as widely expected, will boost demand, analysts said. According to the CME FedWatch tool, the odds of a 50-basis-point interest cut are now 63% compared with 33% for a 25-bps cut.
The sentiment was also boosted by a weak dollar which makes dollar-denominated commodities, such as base metals, cheaper for those holding other currencies. At 1555 IST, the dollar index, which measures the strength of the greenback against a basket of major currencies, was down 0.3% at 100.74.
"Markets are hopeful for more policy support from China, as recent credit data indicated that private sector confidence remains weak despite prior interest rate cuts, raising concerns about long-term consumption prospects," Kotak Securities said in a note.
ALUMINIUM prices rose due to buying by commodity trading advisers. The positive cue was further lifted by declining bauxite stocks at Chinese ports.
COPPER prices rose on prospects of further policy support from top consumer China and a weaker dollar.
At 1600 IST, on the MCX, the September futures contracts of:
- Aluminium was at 230.70 rupees per kg, up 0.3%
- Copper was at 809.10 rupees per kg, up 0.1%
- LEAD was at 183.60 rupees per kg, up 0.4%
- ZINC was at 266.85 rupees per kg, down 0.2%
Trading levels for the day on the MCX:
- Aluminium contract seen at 225.20-233.00 rupees
- Copper contract seen at 800.70-813.70 rupees
- Lead contract seen at 180.20-185.50 rupees
- Zinc contract seen at 260.20-270.00 rupees
End
US$1 = 83.75 rupees
IST, or Indian Standard Time, is five-and-a-half hours ahead of GMT
Edited by Akul Nishant Akhoury
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