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Interesting trend can be seen between silver, gold and crude

Karachi, June 28, 2013 (PPI-OT): It’s been a downfall if we look back three months. There have been some consecutive drops in gold, which may seem out of the normal trend. A 28% negative for this year may seem that the market is losing its grip.

However, seen from another perspective, a drop like this does provide an opportunity to cross hedge. Sensitivity to bond markets has increased for bullions, after recent announcements from the Fed. Investors would now look forward to other portfolio pockets to stack their funds.

An interesting trend can be seen between silver, gold and crude. Silver tends to show a positive relation, whilst crude’s price path provides the complete opposite. Other than demand and supply factors, these commodities do seem to have a common ground, providing a strong relation with macro-economic measures.

China’s less than expected growth can lead to increased volatility for crude and silver.
Rice exports from India, the world’s second-largest grower, may decline this year from a record as buyers turn to cheaper supplies from Vietnam and Pakistan, according to a traders’ group. Shipments may fall 6 percent to 9.5 million metric tons in the year that started in April from 10.1 million tons a year earlier, said Vijay Setia, a former president and member of the All India Rice Exporters Association.

Settlement Prices at PMEX were as follows with volumes at Rs. 5.38 billion with 23,482 lots traded:

GOLD: USD 1,203.9 /t oz
SILVER: USD 18.803 /t oz
CRUDE OIL: USD 97.3 / barrel
IRRI-6: Rs. 3,741 /100 kg
Palmolein: Rs. 4,419 / Mound
Sugar: Rs. 46.75/kg
Wheat: Rs. 3,392/100 kg
ICotton: US cents/pound 86.45

For more information, contact:
Sarang Abbasi
Asst. Manager, Risk and Analytics
Pakistan Mercantile Exchange
9th Floor, PRC Towers, 32-A,
Lalazar Drive M.T.Khan Road,
Karachi, Pakistan.
Cell: +92-03215148905
Fax: +92-35611263
UAN: +92-21-111-623-623, 99210650-61

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