Gold and silver prices didn’t do much yesterday as gold slightly rose while silver inched down. In the currencies markets the British pound rallied against the USD following the latest speech of BOE Governor Carney. Moreover, many other currencies also appreciated against the USD including the Japanese yen and Euro. For the bullion market, gold and silver might remain at their current levels on account of strong demand for the physical metals in China and India. On today’s agenda: China’s Trade Balance, Japan Current Account, Australia Employment Report, ECB Monthly Bulletin, U.S. Jobless Claims, and China’s CPI.
Here is a short outlay for precious metals for Thursday, August 8th:
Gold and Silver Review – August
On Wednesday, gold slightly rose by 0.23% to $1,285.40; Silver slipped by 0.08% to $19.51. During August, gold fell by 2.06%; silver slightly decreased by 0.61%.
In the chart below are the normalized rates of precious metals for 2013 (normalized to 100 as of July 10th). The prices of gold and silver have done much in recent days.
The ratio between the two precious metals increased on Wednesday to 65.89. During August, the ratio decreased by 1.45% as silver moderately out-performed gold.
The gold and silver futures volumes of trade have slightly increased at the beginning of the week and reached on Tuesday 163 thousand and 42 thousand, respectively. These numbers are still lower than the volume traded last week. If the volume will remain low this week, this could suggest the odds of sudden sharp changes in the prices of gold and silver due to low volume will decline. The chart below shows the volume of trading gold and silver futures in the CME during the past several weeks.
See here the weekly projection of gold and silver for August 5-9.
On Today’s Agenda
China’s Trade Balance: According to the recent monthly report, China’s trade balance increased again to a $27.1 billion surplus; if the surplus will further rise, it could indicate that China’s economic growth is improving and thus may positively affect commodities;
Japan Current Account: this monthly report will show the developments in the difference between exports and imports for Japan during the previous month; this news may affect the direction of the Japanese Yen;
Australia Employment Report: in the last report regarding June 2013 the rate of unemployment rose to 5.7%; the number of employed (seasonally adjusted) slightly rose by 10,300 people. This report could affect the Aussie dollar (see here the recent report);
ECB Monthly Bulletin: This monthly report for July analyzes the economic developments of the Euro Area such as the price stability, interest rate decisions and governments’ debt; this update may provide some perspective on the forecasts of the EU progress;
U.S. Jobless Claims Weekly Report: in the latest report the jobless claims fell by 19k to reach 326k; this upcoming weekly report may affect the U.S dollar;
China‘s CPI: during May, the Chinese inflation rate rose to an annual rate of 2.7%, which is still lower than China’s target inflation. The low inflation is another indication for China’s economic slowdown. If the inflation will continue to rise, however, this may indicate China’s economic progress is warming up;
Currencies / Precious Metals– August Update
The Euro/USD currency pair slightly rose again on Wednesday by 0.23% to 1.3336. During August, the Euro/USD edged up by 0.26%. Moreover, other currencies such as the Aussie dollar and Japanese yen also appreciated yesterday against the U.S dollar by 0.17% and 1.45%, respectively. The correlations among gold, Euro, Canadian dollar and Aussie dollar remained strong, e.g. the correlation between the USD/CAD and gold price is -0.57 during recent weeks.
Current Gold and Silver Rates as of August 8th
Gold (short term delivery) is traded at $1,277.50 per t oz. a $4 or 0.31% decrease as of 09:42*.
Silver (short term delivery) is at $19.33 per t oz – a 0.99% decrease as of 09:42*.
Here is a reminder of the top events and publications that are scheduled for today and tomorrow (all times GMT):
Tentative – China’s Trade Balance
00:50 – Japan Current Account
02:30 – Australia Employment Report
09:00 – ECB Monthly Bulletin
13:30 – U.S. Jobless Claims Weekly Report
Tentative – China’s CPI
Tentative – China New Loans
01:30 – Reserve Bank of Australia – Monetary Policy Statement
06:30 –China’s Industrial Production
08:45 – French Industrial Production
13:30 – Canada’s Employment Report
For further reading: