Home Arrow Commodity News Arrow Crucial OPEC meet, tightening of interest rates by RBI

Commodity World Roundup

09th June – 15th June - Crucial OPEC meet, tightening of interest rates by RBI & launch of commodity exchange by NSE in October dominate the headlines

Crucial OPEC meet,interest rates by RBI

OPEC Meeting next week, Saudi minister comments on output

June 15, 2018

Saudi Arabia’s Oil Minister has said that they would come to an agreement which satisfies most importantly the market, when asked about the outcome of the meeting between the Organization of Petroleum Exporting Countries (OPEC), which is scheduled to be held in Vienna next week. He further said that it will be a reasonable and “moderate agreement” but nothing “outlandish”. Russia and Saudi Arabia, leaders of the deal that curbed crude output and boosted prices to three-year highs, were scheduled to discuss their next move.

Source: Business Standard

India's cotton exports are expected to jump 43 per cent in 2018-19

June 15, 2018

Overall cotton shipments are likely to cross 7 million bales in the ongoing 2017-18 marketing year and cotton exports are expected to jump 43% to 10 million bales (of 170 kg each) in the 2018-19marketing year on the back of strong overseas demand, especially from China, according to industry body CIA. Already 6.2 million bales have been exported till May 2018.

Source:Economic Times

Silver consumption in India has increased multi-fold

June 14, 2018

India’s silver use has tripled in a decade, it’s world share having gone up from 14.7% to 39.2%. Silver consumption in India has increased multi-fold in the past one decade, according to a report on the precious metal released recently by the Silver Institute. Around 601 tonnes of silver were used in the country in 2008 for jewellery making, and this rose to 2,058 tonnes in 2017. In the same period, the use of the metal in silverware rose from 481 tonnes to 1,212 tonnes, according to the World Silver Survey 2018.

Source: Business Standard

Oil prices eased on Thursday, dragged down by rising output

June 14, 2018

Oil prices eased on Thursday, dragged down by rising output and a decline in China's refining activity, although strong fuel consumption in the United States and a drop in its crude inventories provided some support.

Source:Economic Times

Hackers had stolen over $37 million worth of Bitcoin

June 13, 2018

The price of Bitcoin has fallen to a four-month low, days after the South Korean virtual currency exchange. Hackers have stolen a third of the virtual currency it had stored. After the exchange announced the theft, the price of Bitcoin dropped $500 in an hour and it has continued to slide.

Source:Live Mint

India’s fuel consumption in May 2018 totalled 18.71 million tonnes as compared to 18.1 million tonnes in May 2017

June 12, 2018

India's fuel demand rose by 3.8% in May as frequent price increases dented auto fuel consumption. Fuel consumption in May 2018 totalled 18.71 million tonnes as compared to 18.1 million tonnes in the same month last year - PPAC.

Source: Economic Times

Equity hedge against Gold is not proving fruitful

June 11, 2018

In 2018, not only are stocks producing lower returns with more volatility, US government bonds are down anywhere between 2% and 4%. Gold, another portfolio hedge, is flat year-to-date. Since November, global stocks are up around 3% in dollar terms; the US has done even better, gaining roughly 5%. At the same time, a broader index of US bonds is off around 2.5% while gold is flat. In other words, gold has beaten bonds but has been a drag on equity returns.

Source:Economic Times

Gold import projection is expected to be lower in the year 2018 – relief for RBI

June 11, 2018

Gold import projection is expected to be lower for the second half of the year. The bullion market is rife with rumours of the government putting more restrictions on import. After a steep rise last year, gold import is likely to fall at least 15% in 2018. This might come as a relief for policymakers and the Reserve Bank of India (RBI).

Source: Business Standard

Higher oil prices may not amount to higher remittances this time

June 11, 2018

India took the top spot on remittances received in 2017. Remittances increased by about 10% last year over 2016, although this comes on a favourable base considering that remittances had decreased by 9% in 2016. Shouldn’t higher crude oil prices this year lead to a rise in remittances? We typically receive a large proportion of our remittances from the Gulf region and 2017 was no different. Chart 1 alongside shows the countries from where remittances flowed to us last year. A big chunk coming from the Middle East means that the pattern or flow of remittances closely aligns with crude oil prices. Chart 2 has the details.

Source: Live Mint

Interest rate tightening starts post RBI meeting

June 10, 2018

The interest rate cycle may have shifted to a phase of tightening of rates. After a gap of four years, the apex bank has hiked interest rates in its latest Monetary Policy review. It has raised the key Repo Rate—the rate at which the central bank infuses liquidity in the banking system—by 25 basis points to 6.25%. Concerns over inflationary pressure stemming from rising commodity prices were behind this decision.

Source: Economic Times

SEBI permission to NSE to launch a commodity exchange, will start on 01st October, 2018

June 10, 2018

NSE, the country’s largest stock exchange, has filed papers with market regulator SEBI to launch a commodity exchange on 01st October. The exchange will initially focus on less complex non-agriculture commodity futures and move on to Agri commodity futures over time. Though SEBI permission to launch a commodity exchange is just a formality, NSE has to seek its approval for specific products and contract design. The exchange will launch trading in bullion, energy and base metals on 01st October.

Source: Business Line