Gold is likely to rule steady in the domestic market on Wednesday as there is no clear view on the monetary policy that the US and Japan may follow. This has weakened the dollar, while the yellow metal is currently being supported by buying in China.
In early trade in Asia, spot gold quoted at $1,658.75 an ounce, while gold for delivery in February ruled at $1,658.40.
Any drop in the dollar makes imports of commodities such as gold, crude oil and vegetable oils cheaper. Investment by foreign institutional investors in India could also prop up the rupee that could be offset by demand from banks and importers. A rise in Brent crude price above $110 a barrel is another concern that could tell on the rupee.
The oils and oilseeds complex could come under pressure after soyabean dropped on the Chicago Board of Trade (CBOT). Malaysian palm oil, too, dropped on Tuesday on fears over demand.
On CBOT, soyabean for delivery in March quoted lower at $13.86 a bushel, while on Bursa Malaysia Derivatives Exchange, crude palm oil for delivery in March dropped to 2,393 ringgit ($787) a tonne.
The grains complex could be mixed with corn (industrial maize) gaining and wheat dropping on CBOT. Corn gained on concerns that the US Department of Agriculture could lower its production estimates as the US Mid-west went through a torrid drought not seen for decades.
Corn for delivery in March quoted at $6.88 a bushel, while wheat for delivery the same month fell to $7.50.
Crude oil may head south after stockpiles in the US increased. Brent crude oil for February delivery quoted at $111.99 a barrel, while Nymex crude for the same month ruled at $93.16.
This is likely to see rubber ruling strong as its alternative synthetic rubber, derived from crude oil, will gain.