Gold and silver plummeted on Thursday: Gold price tumbled down by 2.43% and silver by 4.42%. Is the market changing its perspective regarding the FOMC’s next move? It remains unclear whether the Fed will taper QE3 next week. Some analysts suspect the tapering might not start next week, which could pull back up gold and silver prices. The economic data of U.S will still affect the market expectations regarding tapering. In the U.S jobless claims plummeted by 31k to reach 292k – this sharp drop may have contributed to the pull back of precious metals prices. The federal budget showed a rise of $147 billion in deficit. In Europe, industrial production fell by 1.5% during last month, which may have adversely affected the Euro against the USD. Will gold and silver continue to decline? On today’s agenda: Euro-Group Summits, ECOFIN Summit, U.S. Retail Sales Report, U.S. Producer Price Index, and UoM Consumer Sentiment.
Here is a short review for precious metals for Friday, September 13th:
Gold and Silver Prices Recap – September Update
On Thursday, gold sharply fell by 2.43% to $1,330.30; Silver decreased by 4.42% to $22.11. During September, gold decreased by 4.69%; silver, by 5.82%. In the chart below are the normalized prices of precious metals for 2013 (normalized to 100 as of August 9th). The rates of gold and silver changed direction and fell after they had increased in August.
The gold and silver futures volumes of trade have risen and reached on Thursday 197 thousand and 54 thousand, respectively. If the volume rises today, this could suggest the chances of sudden sharp change in the prices of gold and silver due to high volume will rise.
See here the weekly forecast for gold and silver for September 9-13.
On Today’s Agenda
Euro-Group Summits: In this summit, the EU ministers of finance and Euro-Group President will convene in Brussels;
ECOFIN Summit: The EU ministers of finance will focus on the economic changes in EU;
U.S. Retail Sales Report: In the previous report regarding July, the retail sales inched up by 0.2% from the last month;
U.S. Producer Price Index: In the last report regarding July, this index for finished goods remained unchanged compared with June’s level and the core PPI inched up by 0.2%; this news might affect precious metals prices;
UoM Consumer Sentiment (preliminary):University of Michigan will come out with its preliminary consumer sentiment monthly update; this survey could offer information regarding the latest changes in U.S consumers’ sentiment; According to the last update, the sentiment index fell to 80.0;
Currencies / Precious Metals– September Update
On Thursday, the Euro/ USD currency pair slightly fell by 0.08% to 1.330. During the month, so far, the Euro/USD rose by 0.59%. Moreover, other currencies such as the Aussie dollar and Canadian dollar also slightly depreciated yesterday against the U.S dollar by 0.60% and 0.04%, respectively. The correlations among gold, Euro and Aussie dollar slightly weakened in the past several weeks, e.g. the correlation between the AUD/USD and gold price is 0.14 during August-September.
Current Gold and Silver Rates as of September 13th
Gold (short term delivery) is traded at $1,306.40 per t oz. a $24.2 or 1.82% decrease as of 10:30*.
Silver (short term delivery) is at $21.44 per t oz – a 3.20% decrease as of 10:30*.
Here is a reminder of the top events and publications that are scheduled for today (all times GMT):
All Day – Euro-Group Summits
All Day – ECOFIN Summit
13:30 –U.S. Retail Sales Report
13:30 – U.S. Producer Price Index
14:55 – UoM Consumer Sentiment
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