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The US Dollar Index traded marginally higher by 0.1 percent in the last week on the back of mixed economic data from the country. However, overall the currency remained week due to upbeat market sentiments which led to fall in demand for the low yielding currency. The Dollar is trading at 80.37 up 3 points in the Asian session. Gold continued its more than 3 percent fall for the second consecutive week as investors sentiment turned bearish after Fed Chair Janet Yellen said the central bank will probably end its massive bond-buying program this year, and could start raising interest rates around six months later. Recent forecasts of sharply lower gold prices at below $1,200 by Societe Generale and other bullion banks also prompted institutional investors to sell bullion. Decline in SPDR holdings also exacerbated the fall and exerted downside pressure on prices.
Base metals traded on a mixed note in the last week taking cues from mixed economic data from the US along with weak manufacturing data from China which exerted downside pressure on prices. Also, mixed manufacturing data from the Eurozone coupled with strength in the DX and mixed inventories data acted as negative factors. While on the other hand, expectations of demand pick up in China owing to lower prices and rising orders supported gains. A rise in risk appetite in the market sentiments in the latter part added an upside to prices.
Copper is trading at 3.034 down by 6 pips after its strong gains on Friday. Copper prices jumped by around 3 percent last week on the expectations that demand will fasten in the world’s biggest consumer, China given lower prices and increasing order book. Also, concerns that global supply will be lesser than forecasted on the back of shutdown in copper mines in the biggest producer, Chile along with rise in risk appetite in the market sentiments supported gains. Further, weak manufacturing data from the US, China and Eurozone coupled with strength in the DX could not restrict sharp gains. Additionally, gain of 0.6 percent in inventories could not push the prices lower.