Here is a short overview of the recent developments in gold and silver prices during the week of March 12th to March 16th and an outlook for the upcoming week of March 19th to March 23rd; this includes a short description of the main news items, decisions and events that may have influenced precious metals traders during last week; in this analysis I use charts and a fundamental analysis to examine how if at all last week’s events, decisions and financial reports affected the path of gold and silver prices.
During last week gold and silver prices declined by 3.03% and 4.17% respectively.
One of the main events that affected the path of bullion last week was the FOMC statement in which it was reveled the Fed will maintain its current policy and will not introduce any additional stimulus plan because the U.S. economy is showing signs of recovery.
Since the expansion of the U.S monetary base is linked with the rise of silver and gold prices in recent years, the decision of the Fed not to make another monetary expansion pulled down the bullion prices.
During last week there were other U.S related financial reports that came out including U.S PPI, Philly Fed manufacturing Index and U.S CPI. All these indexes were positive, but didn’t increase by a high rate and thus may have had only little effect on metals market.
Finally, it was reported on Friday March 16th that India, the leading country in importing gold, raised the taxes on gold (but not on silver) from 2% to 4%. This was the second time this year India raised taxes on importing gold. This news may have also been among the factors to drag down the price of gold on Friday and could continue to adversely affect gold price in the weeks to come.
The Euro edged up against the U.S dollar during last week; other “risk” currencies such as the Australian dollar and Canadian dollar also very moderately traded up against the U.S dollar during said time. This direction of the Euro/U.S. dollar AUD/USD and USD/CAD may have slightly curbed the fall of bullion prices during last week. If these currencies will trade down during the upcoming week then it is likely to drag down precious metals prices. The Euro-group and IMF approved the second Greek bailout that may have eased some of the speculation around the stability of the Euro for the time being.
The video link above provides a broad outlook for the major news, decisions and events that may affect the direction of gold and silver prices during the week of March 19th to March 23rd; the video includes reviewing the main reports, events, decisions and news items that will come out during the upcoming week. Some of these reports and events include: FOMC meeting and rate decision, U.S. housing starts, GB CPI, U.S existing home sales monthly update, U.S. new home sales, EU manufacturing PMI, Canada’s retail sales and U.S. jobless claims weekly update (just to name a few).
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