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Commodity World Roundup

14th July – 20th July – Rupee sliding to new record lows, recovery in domestic gold prices & other trending news

Rupee sliding to new record lows, recovery in domestic gold

1. Indian rupee ended at a record closing low against the dollar

July 20, 2018

Political volatility at home, selloff in Emerging Markets’ currencies push the rupee to a new low, as an EM currency selloff and an impending vote of confidence on Prime Minister Narendra Modi’s government weighed on investor sentiment. The Indian Parliament will debate a no-confidence motion on Friday. Although there appears to be no real threat to the government, investors would watch the outcome to gauge the ability of the government to take decisions before general elections due next May.

Source: Newsfeed

2. Commodity Mutual Funds a reality soon

July 19, 2018

SEBI is to soon frame guidelines to allow MF’s in Commodity Derivatives, to increase the institutional participation in the commodity segment. SEBI today said it will soon finalise the guidelines to allow mutual funds to invest in the commodity derivatives segment. The markets regulator said it will also frame warehousing norms for non-agriculture commodities and will consider allowing 'indices' once its robustness is established by the bourses.

Source: Economic Times

3. Zinc falls sharply with other metals

July 19, 2018

Three-month zinc on the LME gave up early gains to trade sharply lower on Thursday as another broad sell-off in industrial metals took hold. Shanghai zinc had earlier jumped by the daily limit of 6 per cent to a one-week top following a report that China plans to boost liquidity in the banking sector, and was underpinned by falling inventories and a weaker Yuan.

Source: Business Line

4. Heavy sell off pushes LME copper below $6,000 as China sends metals into freefall

July 19, 2018

A new round of trade war tensions is sending metal markets into a tailspin. Copper crashed through $6,000 a metric ton for the first time in a year and is heading for its biggest monthly drop since 2015. Zinc, lead, nickel and aluminium tumbled as the dollar rose for a third day. An index of copper-mining companies headed for the lowest close since 2016, paced by losses in Freeport-McMoRan Inc. and First Quantum Minerals Ltd.

Source: Bloomberg

5. The sudden fall in global crude oil prices is propping bond market

July 18, 2018

Oil’s fall lifts sentiment in the currency & bond markets and is propping up more things than just the stocks of motor-fuel retailers. The rupee should retrace the lost ground against the dollar if Saudi Arabia were to raise output further, triggering a meaningful slide in India’s energy costs.

Source: Press Reader

6. MCX cotton deposits up 294% in June

July 17, 2018

MCX has received an extremely encouraging response with cotton deposits in the current season (October 2017) till date, notably increasing by 294 % in June 2018 as against June 2017. MCX witnessed a 57% jump in its cotton contract’s average daily volume from 2,605 lots (1 lot equals 25 bales) in June 2017 to 4,085 lots in June 2018. Correspondingly, there has been a substantial increase in the average daily value from Rs 132 crore to Rs 231 crore over the said period. Moreover, the cotton stocks in warehouses hit a five year high at 1,61,000 bales in June 2018. The open interest stood at 13,581 lots at the end of June 2018, the exchange said in a statement.

Source: Financial Express

7. Diesel, petrol may get cheaper soon as global prices decline

July 17, 2018

Diesel and petrol buyers can expect a fall in prices in the days to come, thanks to softening Freight-On-Board (FOB) prices of the fuels in the international market. Over the past four working days, while the FOB price of petrol has fallen from $83.87 per barrel to $79.31, FOB prices for diesel have softened to $82.72 per barrel from $87.73.

Source: Financial Express

8. Gold recovers on global cues, jewellers' buying

July 16, 2018

Gold prices recovered by Rs. 60 to Rs. 31,150 per 10 grams at the bullion market on Monday tracking a firm trend overseas amid pick-up in buying by local jewellers. Silver also edged up by Rs. 35 to Rs. 39,950 per kg on increased off take by industrial units and coin makers. Market men said sentiment turned better after gold prices recovered from a seven-month low in the global markets today, after sluggish GDP data from China weighed on the Asian stocks and as the dollar traded below its recent highs.

Source: Asian age

9. The rupee retreated from a near two-week high

July 16, 2018

Rupee snaps a 3-day rise as rising inflation fans rate hike fears and ended lower by 4 paise at Rs. 68.57 against the US currency, snapping a three-session recovery trend due to renewed dollar demand. A combination of declining domestic macro stability and growing prospects of interest rate hike largely weighed on trade during the day.

Source: Money-Control

10. India is looking at removing the ban on gold imports from South Korea

July 16, 2018

India looks to lift ban on gold imports from South Korea, at zero customs duty under the Comprehensive Economic Partnership Act (CEPA) as soon as it introduces a compulsory Regional Value Content (RVC) requirement in the pact to prevent third country imports from flowing in.

Source: Business line

11. Gold imports fell by 25 per cent to $8.43 billion in the first quarter

July 15, 2018

Gold imports in the June quarter dip 25% to $8.43 billion of the current fiscal due to sliding prices of the metal in both global and domestic markets. According to the commerce ministry data, gold imports had amounted to $11.26 billion in the corresponding quarter of last financial year 2017-18.

Source: Economic times