'Gold to fall further as rupee may recover, crude to consolidate'

Since we expect the Indian rupee to recover in coming week too, the yellow metal may stay weak.

It was a choppy trading week for gold traders. US Fed minutes confirmed rate pause for this year but weekly jobless claims fell to an almost 50 years low and producers price index rose well above forecast, hence dollar strengthened.

Meanwhile, the US showed readiness to begin another round of talks with North Korea hence geopolitical risk reduced. For the entire week, no activity was seen in SPDR gold ETF. Although China's government reported that the country's gold reserved rose for the fourth straight month, the yellow metal depreciated in the week.

The metal market these days is grappling with issues. Already a year-long trade tiff with China is far from getting resolved, International Monetary Fund (IMF) lowered global growth forecast, US threatened EU to impose tariffs on goods, Brexit got delayed by six months and China trade data for March drove the market for metals.

In a fresh bid, the US threatened to impose tariffs on $11 billion of European goods but the EU immediately agreed to talk. Since IMF in its latest global projections lowered 2019 growth forecast to 3.3 percent from 3.5 percent- the lowest since the financial crisis and also marked the third downgrade in six months, the base metals reacted negatively mid-week. Later as the US posted strong economic data, the dollar faltered sharply and industrial metals nosedived.

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