US Dollar weakness is expected to support gold and silver prices

Angel Commodities has come out with its report on international commodities. According to the research firm US Dollar weakness is expected to support gold and silver prices in the international markets today.

European markets traded on a mixed note today as the European Central Bank (ECB) stated that the steps taken by them may not be the final solution to the underlying debt issues in the 17-nation Euro region and we feel that positive sentiments could be short-lived if the provided measures do not yield the desired results.

Spot Gold prices traded slightly higher by 0.1 percent today mainly on the back of a weaker dollar that made dollar-denominated commodities cheaper for the holders of other currencies. The yellow metal touched an intra-day high of $1754/oz and was trading at the level of $1746/oz till 4.45 pm IST today. On the MCX, Gold prices declined around 0.3 percent on account of Rupee appreciation and was hovering around Rs 29,040/10 gms till 4.45 pm IST.

Taking cues from rise in gold price and a weaker dollar, silver gained around 0.9 percent till 4.45 pm IST today. However, further gains were capped as silver being an industrial metal also took cues from movement on the base metals. Prices touched an intra-day high of $33.32/oz and were trading at $33.11/oz till 4.45 pm IST. MCX SilverMarch contract rose by 0.6 percent and hit an intra-day high of Rs55,927/kg till 4.45 pm IST today.

Rising concerns with respect to Euro Zone debt worries coupled with weak manufacturing data from China exerted downside pressure on base metal prices today. Additionally mixed sentiments in the global markets also acted as a negative factor. However, further decline was cushioned on account of dollar weakness.

Nymex crude oil prices increased by 0.3 percent today, on the back of expected supply concerns from the Middle East. Additionally a weaker dollar also acted as a positive factor for the commodity. Prices are hovering around $100.66/bbl after touching an intra-day high of $100.99/bbl till 4:45pm. On the MCX, prices declined by 0.8 percent on the back of Rupee appreciation and were trading around Rs.5177/bbl till 4:45pm today.

Outlook
US Dollar weakness is expected to support gold and silver prices in the international markets today. But downside risks remains if European concerns heighten.

Base metals are expected to witness downside pressure today on account of weak Chinese manufacturing data. But technically we expect buying to emerge at lower levels.

On account of potential supply disruptions from Iran coupled with the ongoing winter season, crude oil prices are expected to trade on a positive note today.

Tags: price of silver, Silver, silver analysis, silver news, silver price, silver price forecast, silver prices, silver spot, spot silver

Posted by Silver Guru on Dec 1 2011. Filed under Silver Analysis. You can follow any responses to this entry through the RSS 2.0. You can leave a response or trackback to this entry