Spot Gold prices slipped today, touching an intra-day low of $1093/oz till 4.00 pm IST as the dollar index continued to strengthen on Greece’s concerns. The greenback touched a 10-month high against the euro after the Eurozone ministers said that providing a financial aid for Greece would require help from IMF, reducing the confidence in the European union. This factor led the dollar to strengthen and exerted pressure on gold prices as the yellow metal prices usually trade inversely to the greenback. The EU meeting in Brussels on 25th and 26th March would further put some light on the issue. Copper prices declined on the LME today till 4.15pm IST facing pressure from the stronger dollar. The red metal prices are continuously facing pressure from the dollar from the start of this week. Copper inventories declined marginally on the LME today, but this factor could not favor prices from tumbling down. Another factor that is weighing on the metal prices is the Chinese concern of rising interest rates to tame inflation. Although the government has not yet specified any details, the country would need to increase interest rates very soon to control inflation and growing real-estate prices. Crude oil prices declined today as the stronger dollar coupled with concern of rising inventories weighed on the prices. The API department yesterday reported that crude inventories in US, the world’s largest consumer of crude oil increased 7.51 million barrels to 351.5 million in the last week. The US energy department is also scheduled to release data on crude oil inventories later in the evening today. The forecasts reveal that the trend of increasing inventories would continue this week which would put pressure on the prices. Outlook The US is expected to announce economic data on new home sales and durable goods orders today. However, the Greece’s concerns are dominating the investor sentiments. Today, the dollar would continue to remain strong as a safe-haven investment. The dollar-denominated commodities would continue to trade with a negative bias till any concrete financial assistance is provided to Greece. Crude oil prices would take cues from the inventory data releases. Gold prices would face pressure from the stronger dollar. Base metal prices will also take cues from the CFTC’s public hearing which is expected to take place on 25th March. The CFTC plans to impose limits on the metals markets as these instruments are blamed in part for the collapse of insurer AIG that intensified the financial crisis of 2008-09. If the hearing is against the metals sector then prices could be hit on the downside.

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