The prices of silver and gold changed direction and bounced back from their two day fall. Their recent rally coincided with the recovery of leading currencies such as Euro and Japanese yen against the USD. In the U.S, jobless claims rose by 7k to 343k; U.S core durable goods sharply rose by 4.2% during last month. These news items may have helped to pull up commodities prices. In Europe, the monetary developments report showed a drop in M1 and M3 and contraction rate in loans to private sector reached 1.6%. This is another negative indication for the progress of the EU.
Will gold and silver prices continue to rise today? On today’s agenda: UoM Consumer Sentiment.
Here is a short outlook for precious metals for Friday, July 26th:
Gold and Silver Recap – July Update
On Thursday, gold changed direction and rose by 0.70% to $1,328.80; Silver also slightly increased by 0.66% to $20.15. During July, gold rose by 8.58%; silver, by 3.57%.
In the chart below are the normalized prices of silver and gold for 2013 (normalized to 100 as of June 28th). The prices of gold and silver have moved in an unclear trend during the week.
The gold and silver futures volumes of trade have increased in recent days and on Thursday reached 245 thousand and 35 thousand, respectively. If the volume will fall today, this could suggest the odds of sudden sharp shifts in the prices of gold and silver due to low volume will diminish. The chart below shows the volume of trading gold and silver futures in the CME during June and July.
See here the weekly outlook for precious metals for July 22-26.
On Today’s Agenda
UoM Consumer Sentiment (revised):University of Michigan will publish its revised consumer sentiment monthly update; this survey could offer an insight to recent developments in U.S consumers’ sentiment; based on the recent report, the sentiment index slipped to 84.1;
Currencies / Precious Metals Market – July Update
The Euro/ USD currency pair also bounced back on Thursday by 0.58% to 1.3277. During July, the Euro/USD increased by 2.05%. Further, other currencies such as the Aussie dollar and Japanese yen also appreciated yesterday against the U.S dollar by 0.92% and 0.98%, respectively. These changes may have contributed to the recent rally of commodities prices. Moreover, if this trend will continue, it may further pull up gold and silver rates. The chart below shows the strong linear correlations among precious metals prices and leading currency pairs.
Gold (short term delivery) is traded at $1,336.20 per t oz. a $6.7 or 0.50% increase as of 08:51*.
Silver (short term delivery) is at $20.19 per t oz – a 0.15% increase as of 08:51*.
Here is a reminder of the top events and publications that are scheduled for today (all times GMT):
14:55 – UoM Consumer Sentiment
For further reading: