Kotak Neo Commodity Watch | Gold Heads for First Weekly Gain in Five Weeks on Easing Fed Rate-Hike Bets; Oil Prices Edge Higher

Gold was on course for its first weekly gain in five weeks on Friday after weaker-than-expected US employment data pushed the dollar to a two-week low, lifting demand for precious metals. Silver outperformed gold, extending its rally to a one-week high, while crude oil edged higher despite improving global supply conditions.

Spot gold climbed 2.28% to settle at $4,122.4 an ounce after touching an intraday high of $4,144, while spot silver jumped 2.99% to $60.9 an ounce. On Comex, gold gained 1.06% to $4,125.7, while silver added 0.91% to $61.06. Domestic bullion followed the global trend, with MCX Gold rising 0.92% to ₹1,45,758 per 10 grams and MCX Silver advancing 1.27% to ₹2,33,304 per kg.

The rally followed a softer-than-expected US labour market report that prompted traders to reassess expectations of further Federal Reserve policy tightening. Non-farm payrolls increased by 57,000, well below forecasts of 110,000, while payroll figures for April and May were revised lower. Markets subsequently lowered the probability of a September Fed rate hike to 54% from 66%, weighing on the US dollar and supporting bullion. The World Gold Council also reported that central banks added a net 41 tonnes to official gold reserves in May, adding another supportive factor for gold prices.

Crude oil also ended higher, although gains remained limited as improving supply conditions continued to temper sentiment. Brent crude settled 0.32% higher at $71.8 a barrel, while WTI crude rose 0.16% to $68.7 a barrel. Improving tanker movement through the Strait of Hormuz and progress in indirect US-Iran negotiations have eased concerns over near-term supply disruptions, even as traders continued to monitor geopolitical developments in West Asia.

Base metals delivered a mixed performance. Copper added 0.21% to $13,326 a tonne, supported by the weaker dollar, lower US Treasury yields and resilient Chinese services activity. Aluminium gained 0.50%, while lead rose 0.54%. Zinc and nickel, however, ended lower as markets balanced improving demand prospects against expectations of higher supply. The research also highlighted copper's long-term demand outlook, supported by investment in electrification, power infrastructure and artificial intelligence.

Also Read - Dollar Heads For Biggest Weekly Drop Since April As Weak Jobs Data Cuts Fed Hike Bets

On the domestic derivatives market, Kotak Neo Commodity Research expects MCX Gold (August) to trade with a sideways-to-bullish bias in the ₹1,46,720-₹1,49,185 range. MCX Silver (September) is also seen trading sideways to bullish between ₹2,30,120 and ₹2,44,499. MCX Crude Oil is expected to remain sideways within the ₹6,390-₹6,800 range, while MCX Copper carries a sideways-to-bullish outlook between ₹1,266.30 and ₹1,298.20.