Gold and silver plummeted during most of last week. The sharpest fall came on Friday when gold declined by 4.1%; silver fell by 4.9%. The main event from last week – the publication of the minutes of the recent FOMC meeting – may have been the trigger for the plunge in the prices of precious metals. The minutes may have rekindled the speculations regarding the future of the Fed’s asset purchase program. If the asset purchase program will end in the near future, it could reduce the concerns of many investors regarding the possibility of the US dollar devaluing. The rise in volatility may have been the reason for the CME to raise its margins on gold and silver contracts by almost 20%. This news may have been the main reason for the recent drop in bullion prices. Will gold and silver continue to tumble down this week? Currently , the price of gold is falling by 9% and the price of silver is tumbling down by more than 11%. At the current pace, gold and silver are heading for the worst performing month in the past few years. The shift in market sentiment seem to have pulled out many investors from gold and silver. Will this bearish market sentiment in the precious metals market persist? As I have pointed out in the latest precious metals weekly outlook, several reports, summits and publications may affect bullion prices. These items include: U.S housing starts, Philly fed index, U.S CPI, IMF and G20 Summits, and U.S jobless claims. On today’s agenda: U.S. TIC long term purchases, China’s GDP for Q1 2013 (update: China’s GDP grew by only 7.7% – lower than expected – in the first quarter of 2013), Minutes of RBA’s meeting and Kuroda’s speech.
Here is a short outlook for precious metals for Monday, April 15th:
Precious Metals – April Update
On Friday, the price of gold tumbled down by 4.06% to $1,501.0; Silver also decreased by 4.93% to $26.33. During April, gold declined by 5.88%; silver, by 6.93%. Moreover, during last week, the SPDR Gold Shares (GLD) also plummeted by 5.8% and reached by April 12th 143.95. Shares of iShares Silver Trust (SLV) also plunged by 4.21% during last week.
For the rest of the report you can see it at Seeking Alpha
Here is a reminder of the top events and publications that are scheduled for today and tomorrow (all times GMT):
Today
03:00 –China First Quarter GDP 2013
07:15 – Kuroda’s Speech
14:00 – U.S. TIC Long Term Purchases
00:30 – Minutes of Australia’s Bank Monetary Policy Meeting
Tomorrow
09:30 – GB CPI (March 2013)
09:30 – Great Britain PPI Input
10:00 – Euro Area CPI
11:00 – German ZEW economic sentiment
Tentative – Bank of England Inflation letter
13:30 – Canada Manufacturing Sales
13:30 –U.S Core Consumer Price Index
For further reading: