MCX Base Metal Outlook – Commodity Weekly Trend

MCX Base metals are expected to trade lower amid euro zone problems and rise in greenback. Copper price fell near a three-week low on last week as Europe’s debt crisis remained unresolved; denting demand prospects, and after the U.S. Federal Reserve decided to do nothing new to prop up growth. Risk aversion also pushed up the U.S. dollar, generally perceived as a safe-haven asset, which put additional pressure on industrial metals prices.

While commenting on copper outlook MCX Copper prices can trade in range of in 370-395 in domestic market. There are growing concerns about the outlook for Europe and some concerns also about China’s ability to steer its way through the worldwide difficulties. According to the International Copper Study Group (ICSG) Mine capacity utilisation fell steadily from over 90% at the start of the last decade to 80.4% last year. The market has remained substantially skeptical after the EU leaders` failure to reach any solution in last meeting and it is still unclear whether the rating agencies would downgrade European countries, and this is putting some pressure on metals.

Copper production has been heavily disrupted this year by long strikes at some of the world’s biggest mines including Freeport’s mines in Indonesia and Peru. Lead and zinc can further slide towards 100 and 95 respectively. Meanwhile Aluminium prices can trade in range of 102-107 in MCX.