Gold prices on spot and futures market are likely to rise with a drop in dollar aiding the trend in the global market. Besides, lower prices are still attracting buyers, especially in Asia.
However, investors’ interest in the yellow metal continues to wake as seen in drop in gold held in electronic form. Holdings in exchange-traded products were down to 2,229.5 tonnes.
In early Asian trade at Singapore, spot gold was up at $1,440.75, while gold futures maturing in June quoted higher at $1,441.10 an ounce.
The drop in dollar could, however, change the scenario in India as any fall in the US currency against the rupee will make imports of commodities such as gold, crude oil and vegetable oils cheaper. Therefore, this could curb the gains.
In India, the protest over local body tax continues to hamper bullion trade in Mumbai. On MCX, June gold contracts could rise to as higher as Rs 28,000 for 10 gm, while August futures could top Rs 29,000.
Crude oil
Crude oil is likely to rule lower as higher stocks in the US have put pressure on prices. Stocks are at an eight-decade high and the US data due later tonight is likely to reiterate it.
Brent crude June contracts dropped to 102.96 a barrel, while West Texas Intermediate (NYMEX) contracts fell to $95.40.
Soyabean, crude palm oil
The oils and oilseeds complex will likely heat up as sowing of soyabean in the US is slower compared with last year as also the general average. According to the US Department of Agriculture, only six per cent of the crop has been planted so far against last year;s 43 per cent and the normal 24 per cent.
Chicago Board of Trade (CBOT) soyabean July contracts were up at $14.20 a bushel. On Bursa Malaysia Derivatives Exchange, crude palm oil for July delivery was down at 2,035 ringgit ($769) a tonne.
Corn, wheat contracts
The grains complex will also heat up as sowing of corn is also sharply down in the US. Speculation is rife that sowing could end being lower this year than the initial projections.
CBOT corn for July contracts rose to $6.55 a bushel, while wheat contracts for the same month, rising in sympathy with corn, quoted at $7.10 a bushel.
Rubber could head lower as prices on the Tokyo Commodity Exchange dropped as the Japanese currency rebounded against the dollar. October contracts fell to 288 yen a kg (Rs 156 a kg) on the Tokyo Exchange.