The prices of gold and silver bounced back and rose during most of last week despite the recent speculations around the future steps of the FOMC. Specifically, the minutes of the last FOMC meeting revealed the concerns of several members regarding the current asset purchase program. Bernanke in his testimony in Congress didn’t rule out the option of tapering the current asset purchase program in the near future. Perhaps the June FOMC meeting might bring some changes to QE3. In any case, this news didn’t curb by much the rally of precious metals prices. The decline in the equity markets in the U.S, the recovery of leading currencies such as Euro and Japanese yen against the USD may have also contributed to the rally of gold and silver prices during last week. In the U.S several reports came out and mostly painted a positive trend regarding the progress of the economy: new home sales slightly rose by 2.3% during April; existing home sales also slightly increased during the previous month; jobless claims slipped by 23k to reach 363k; in orders for manufacturing durable goods rose by $7.2 billion in April. In other countries, China’s flash manufacturing PMI slipped to 49.6 in May; in Europe, Germany’s flash PMI also reached 49.9 in May. These reports suggest the manufacturing sectors in these countries are contracting. These reports may have also slightly affected forex and commodities markets.
Here is a short review of the changes in precious metals prices between May 20th and May 24th:
Precious Metals Recap:
Gold price rose during last week by 1.6%; on the other hand, during the week, the average weekly price reached $1,381.5 /t. oz which was 1.41% below last week’s average rate of $1,401.32 /t. oz. Gold ended the week at $1,386.6 /t. oz.
Silver, much like gold, slightly increased during last week by 0.61%; further, the average weekly rate decreased by 1.95% to reach $22.49/t oz compared to last week’s average $22.94/t oz.
During the previous week, the average daily percent changes of gold reached 0.324%; silver had an average daily change of 0.124%.
The chart below shows the shifts of precious metals, as their rates are normalized to 100 as of May 17th. Gold and silver prices slightly rose during last week.
The second chart shows the daily percent developments of bullion prices (or in other words the changes around the trend). Silver and gold rose during the week. Precious metals prices daily percent changes ranged between 1.78% gain and -0.74% drop.
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