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term and are on track to mark a fresh
record high, surpassing the weakness
in February.
Gold prices in the global market
extended Thursday's gains on Friday
after a significant rise in physical
demand. Spot gold prices rose to
US$1,474.55 per ounce as of 10.28 AM
IST on Friday.
Gold futures for June delivery on
Globex platform of Comex was seen
trading slightly up by 0.87% at
$1474.45 per troy ounce as on Friday.
The concern seems not so much
whether the underlying physical
demand is real, but if wholesale
shortages are a reality? Delays in
precious metal deliveries now seem to
be commonplace. That, in and of
itself, constitutes an effective
shortage.
Precious metals market has seen over
the last week in both silver and gold is
a worldwide surge in physical demand
as prices fell. This is what happens
when the management of perception
backfires.
It seems poetic justice that a drive by
smash-down of precious metal prices
would actually trigger the beginning of
the last phase of this bull market.
Nevertheless, these are exactly the
kinds of consequences that occur
when a market has been prevented
MARKET NEWS
The southern leg of the Keystone XL
line is likely to join the Seaway
project in moving crude from
Cushing to PADD3 towards the end
of the year. Capacity will initially
ramp up to 700 thousand b/d and
ultimately reach 830 thousand b/d.
Pipeline tariffs for moving crude
from Cushing to the Gulf Coast (20-
year commitment) is currently
around $2.5/bbl for light oil, whereas
for heavy oil it is around $4.25/bbl.
US natural gas prices may average
$3.90 per MMBtu in 2013 and $4.10
per MMBtu in 2014, stated London
based Barclays in its recent market
analysis.
Barclay’s analysis of all other supply
and demand variables, excluding gas
use in power generation, suggests
that balances will tighten 1.9 Bcf/d
during the injection season.
Delays in precious metal deliveries
now seem to be commonplace. That,
in and of itself, constitutes an
effective shortage.
Still, how much of this is due to
dealers hanging on to inventory,
given that many would be
underwater on their positions? Also,
perhaps the extent to which
premiums can be utilized has some
psychological limit?
While the government has signalled
some manoeuvring room,
uncertainty surrounding bauxite
supply will likely persist. The more
volatile alumina imports fell by 55%
y/y to 195Kt in March (down 45%
m/m), but total Q1 imports of 1Mt
Were only 11% lower than last year.
Great Britain GDP and U.S Jobless
claims is likely to announce at 02.00
pm IST and 06.00 pm IST
respectively. It may pressurize the
base metal pack and dollar
denominated commodities. Slight
recovery was seen in LME markets.
The existing houses in the country
are now in supply shortfall, these
downbeat figures sent US dollar
index and US stocks down. Decline
in German and Euro zone
manufacturing PMI has forecasted
negative may impact base metal
prices.
Barclay’s analysis of all other supply
and demand variables, excluding gas
use in power generation, suggests
that balances will tighten 1.9 Bcf/d
during the injection season.
10. www.TheEquicom.com +919200009266
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