Last week gold and silver prices started off with little movement but by Thursday both precious metals tumbled down. The FOMC decision to continue operation twist throughout the rest of 2012 by $267 billion and not to introduce QE3 may have been among the factors to pull down bullion rates. The Fed also revised down the U.S economic outlook which also may have dragged down commodities prices. Several other U.S related reports came out last week and showed the U.S economy isn’t expanding: Philly Fed index declined in June to its lowest level this year; existing home sales had an upward trend during last week. U.S jobless claims didn’t change much and declined by only 2k last week. This upcoming week there are several publications on the agenda that may affect gold and silver prices. The main events will revolve around U.S news and pending home sales, GDP for Q1 2012, Euro Area Monetary Development, jobless claims, core durable goods and Canada’s GDP by Industry.
Here is a short outlook for June 25th to June 29th; this includes a short description accompanied with a fundamental analysis of the main reports, publications, and events that may affect precious metals market.
Gold price plunged during last week by 3.76%; Silver, even more than gold, tumbled down on a weekly scale by 7.01%. Furthermore, during last week the SPDR Gold Shares (GLD) also fell by 3.3% and reached by June 22nd 152.64.
The Euro declined against the U.S dollar by 0.54% (on a weekly scale); furthermore, other “risk” currencies such as the Australian dollar and Canadian dollar also depreciated against the U.S dollar by 0.11% and 0.28%, respectively. Their sharpest fall came on Thursday. The decline in the Euro/USD and AUD/USD may have been among the factors to pull down gold and silver during last week. If these currencies will continue to trade down, it could further pull bullion rates down.
In the video below there is a broad overview of the main publications, events and reports that may affect gold and silver prices between June 25th and June 29th. Some of these reports and speeches include U.S news and pending home sales, GDP for Q1 2012, Euro Area M1, M3 & private loans, jobless claims, core durable goods and Canada’s GDP (just to name a few).
In conclusion, I speculate precious metals will continue to dwindle during the upcoming week. The developments in Europe regarding the debt crisis in Spain and Greece may affect not only the Euro/USD but also bullion rates. If the Euro will continue to decline this could also pull down bullion. The upcoming reports regarding the U.S including the new and pending home sales, GDP for Q1, core durable goods and jobless claims, could affect not only the USD, but also gold and silver prices: if the U.S reports will continue be negative or won’t meet expectations it could pull up or at least curb the fall of precious metals.
For further reading: