Industrial metal tumbles on Fed, US dollar
18/09/2014 09:27
Zinc futures slumped in the domestic market on Wednesday as investors and speculators exited positions in the industrial metal as a somewhat hawkish stance by the US Federal Reserve dashed demand prospects. The Fed raised its estimates for interest rates at the end of next year while tapering QE by USD 10 billion, moving closer to tightening monetary policy, clouding the demand outlook for industrial metals.
A stronger dollar dimmed the appeal of zinc as an alternative asset. Stronger greenback makes the base metal more expensive for those holding other currencies, thus dimming demand.
Meanwhile, confidence among Chinese businesses fell to a five- month low in September, signaling a faltering recovery in the world’s second biggest economy, clouding the demand outlook for the base metal. The index measuring business sentiment in China fell to 52.2 in September 2014 from 57.3 in August.
At the MCX, Zinc futures for September 2014 contract closed at Rs. 137.70 per 1 kg, down by 1.61 per cent, after opening at Rs. 139.55, against the previous closing price of Rs. 139.95. It touched an intra-day low of Rs 137.50.
18/09/2014 09:27
Zinc futures slumped in the domestic market on Wednesday as investors and speculators exited positions in the industrial metal as a somewhat hawkish stance by the US Federal Reserve dashed demand prospects. The Fed raised its estimates for interest rates at the end of next year while tapering QE by USD 10 billion, moving closer to tightening monetary policy, clouding the demand outlook for industrial metals.
A stronger dollar dimmed the appeal of zinc as an alternative asset. Stronger greenback makes the base metal more expensive for those holding other currencies, thus dimming demand.
Meanwhile, confidence among Chinese businesses fell to a five- month low in September, signaling a faltering recovery in the world’s second biggest economy, clouding the demand outlook for the base metal. The index measuring business sentiment in China fell to 52.2 in September 2014 from 57.3 in August.
At the MCX, Zinc futures for September 2014 contract closed at Rs. 137.70 per 1 kg, down by 1.61 per cent, after opening at Rs. 139.55, against the previous closing price of Rs. 139.95. It touched an intra-day low of Rs 137.50.
