Gold and Silver Prices – Daily Outlook for July 16

Precious metals prices rallied on Monday and thus continued their general upward trend from last week. In the U.S, retail sales slightly increased again by 0.6% during June. This news may have slightly contributed to the rally of U.S equity markets on the first day of the week. The main event of the week will revolve again around Bernanke’s upcoming testimonies on the Hill, which could stir up the markets again, as his remarks do last week. In the mean time, the sharp rise in silver imports in India has slowed down on account of the rise in import tax. On today’s agenda: U.S Core Consumer Price Index, U.S TIC Long Term Purchases, GB CPI, German ZEW economic sentiment, Euro Area CPI, Bank of England Inflation Letter, Canada Manufacturing Sales.

Here is a short outlook for precious metals for Tuesday, July 16th:

Gold and Silver Prices Review – July Update         

On Monday, gold slightly increased by 0.46% to $1,283.5; Silver also slightly rose by 0.24% to $19.83. During July, gold rose by 4.88%; silver, by 1.95%.

In the chart below are the normalized prices of gold and silver for 2013 (normalized to 100 as of June 18th). The rates of gold and silver have slowly recovered in the past several days.

Gold & silver outlook 2013  July 16The ratio between the two precious metals slightly rose on Monday to 64.73. During July, the ratio rose by 2.87% as gold slightly out-performed silver.

Gold & silver ratio 2013  July 16See here the weekly outlook of gold and silver for July 15-19.

The gold and silver futures volumes of trade have fallen on Friday to 163 thousand and 30 thousand, respectively. These numbers are lower than the volume traded during most of last week. Moreover, the week started with lower volumes of trade. If the volume will pick up in the coming days, this could pull up the volatility of precious metals rates. The chart below shows the volume of trading gold and silver futures in the CME during July.

volume Gold & silver prices 2013  July 16On Today’s Agenda

GB CPI: This report may affect the British Pound currency. In the last report regarding May 2013, the CPI rose to an annual rate of 2.7%;

Bank of England Inflation Letter: this report will come out only if the annual inflation falls below 1% or above 3%;

German ZEW economic sentiment: In May the ZEW indicator for Germany slightly increased to 38.5 points; if Germany’s economic sentiment will keep rising, the Euro will plausibly strengthen;

Euro Area CPI: according to the latest update the annual CPI rose to 1.4%, which is still well below ECB’s target inflation; if the inflation will change direction and decline, it could raise the odds of ECB cutting again its cash rate;

Canada Manufacturing Sales: It may affect the USD/CAD currencies pair, which is strongly linked with commodities prices. In the previous report regarding April 2013, manufacturing sales fell by 2.4%;

U.S Core CPI: According to the U.S Bureau of Labor statistics, during April, the CPI inched up by 0.1% (month-over-month); the core CPI slightly rose by 0.2%; the core index increased over the past twelve months by 1.7%.

U.S. TIC Long Term Purchases: The Treasury International Capital monthly report will present the changes the purchases and sales of US long term treasuries for May 2013. In the recent report regarding April 2013, the net foreign sales of U.S Treasuries longer-term notes reached a deficit of $37.3 billion;

Currencies / Bullion Market – July Update

The Euro/ USD currency pair slipped on Monday by 0.04% to 1.3062. During July, the Euro/USD slightly rose by 0.4%. Conversely, other currencies such as the Aussie dollar slightly appreciated yesterday against the U.S dollar by 0.54%. The correlations among gold, Euro and Aussie dollar weakened, e.g. the correlation between the Euro/USD and gold price is 0.45 in the past several weeks.  If these correlations will start to strengthen, the currencies pairs Aussie/USD, Euro/USD and Canadian dollar/USD are likely to affect bullion prices.

Current Gold and Silver Rates as of July 16th

Gold (short term delivery) is traded at $1,283.40 per t oz. a $0.1 or 0.01% decrease as of 01:22*.

Silver (short term delivery) is at $19.92 per t oz – a 0.41% increase as of 01:22*.

(* GMT)

Here is a reminder of the top events and publications that are scheduled for today and tomorrow (all times GMT):


09:30 – GB CPI

Tentative – Bank of England Inflation Letter

10:00 – German ZEW economic sentiment

10:00 – Euro Area CPI

13:30 – Canada Manufacturing Sales

13:30 – U.S Core Consumer Price Index

14:00 – U.S. TIC Long Term Purchases


09:30 – Great Britain Claimant Count Change

09:30 –MPC Asset Purchase and Rate Votes

Tentative – German 10 Year Bond Auction

13:30 – U.S. Housing Starts

13:30 – U.S. Building Permits

15:00 – Bank of Canada’s Overnight Rate

15:00 – Bernanke’s Testimony

15:30 – Bank of Canada’s Monetary Policy and Press Conference

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