G Chandrashekhar, Commodity Editor, Business Line, is looking at crude prices beyond the first half of this year between USD 50 and USD 55 per barrel. "At the moment, demand is a matter of serious concern for the market and therefore there is a huge short side which is been created but its not going to take time for the short side to turn to a long side."
Here is a verbatim transcript of the exclusive interview with G Chandrashekhar on CNBC-TV18. Also watch the accompanying video.
Q: Gold has seen a huge run, are you looking at a profit taking now or you think the one-sided upside would continue?
A: Certainly there will be some profit taking at these levels but given further upside potential that gold holds there may not be much of a profit taking. In fact if you look at physical gold bag investment product and exchange-traded product (ETP) there has been a huge accumulation for physical stocks in various (ETPs) and exchange-traded funds (ETFs) about 1400 tonne that shows retail investors are interested in physical gold in terms of the exchange traded products. That is what is pushing in gold up.
But if you look at India as a market because the rupee is weakening and the gold has gone up to USD 960-970/oz level, prices are about more than Rs 15,500/10gm levels, there is certainly demand compression at these levels, there is hardly any tail sale and this will have an impact on gold prices going forward.
Primarily India is a largest market for gold and if physical demand for gold rise up in a country like India, markets will have to correct.
Second interesting point is that dollar surprisingly is has further strengthened vis-à-vis the euro. The strong dollar should have been negative for gold, the gold is still continuing its fabulous bull run. Therefore there is a possibility if investors begin to book profits or withdraw from the gold markets and gold could find a correction but at this point of time, I don’t find any sign of gold Bull Run abating soon.
