Gold and silver prices slightly increased on Friday and may continue this slow-paced trading on the last day of the month. Spain published its GDP report: Spain’s GDP had contracted by 0.3% in the first quarter of 2012 – the same rate as in the previous quarter. This is another report showing the economic slowdown Spain is at. Currently this news doesn’t seem to have much of an effect on the financial markets. In a recent report by the IMF Mexico, Russia and Turkey added to their gold reserves about 44.8 metric tons during March (A more details analysis on gold holding is in the recent May report). There are many who anticipate the RBA will cut its interest rate tomorrow. This decision may affect the Aussie dollar which is strongly linked with gold and silver prices.
Currently gold and silver prices are slightly falling. On today’s agenda: EU Monetary development, Canada’s GDP and China’s Manufacturing PMI.
Here is a short analysis for gold and silver prices for Monday, April 30th:
Gold and Silver– April Update
Gold price rose on Friday by 0.26% to $1,664.8; silver much like gold increased by 0.43% to $31.41. During April, gold decreased by 0.42% and silver by 3.3%.
The chart below shows the developments of both bullion prices during recent weeks (gold and silver are normalized to 100 as of March 30th).
The ratio between gold and silver edged down to 53. During April the ratio increased by 2.98% as gold has outperformed silver during the month. In the chart below are the developments of this ratio during recent days.
EU Monetary Development: If the M1 and M3 will continue to increase according to the upcoming report it could serve as another indicator for the rising inflation pressures in the Euro Area, and it may affect the upcoming ECB interest rate decision;
Canada’s GDP: In the previous report for January 2012, the real gross domestic product edged up by 0.1%. This report may affect the strength of the Canadian dollar which is strongly linked with gold and silver prices;
China Manufacturing PMI: according to the last Manufacturing PMI report for March 2012 the Manufacturing PMI rose to 53.1if this upward trend will continue, this may also positively affect gold and silver prices;
Forex / Gold & Silver Market – April Update
The Euro/U.S Dollar slightly increased on Friday by 0.27% to 1.3254. During April Euro/U.S Dollar decreased by 0.67%; furthermore, the “risk currencies” including the Aussie dollar also appreciated on Friday against the U.S. dollar by 0.77%. If the U.S dollar will appreciate against the abovementioned currencies, this may signal gold and silver will decline.
Current Gold and Silver Prices as of April 30th
Gold (May 2012 delivery) is traded at $1,662.8 per t oz. a $2 or 0.12% decrease as of 11:12*.
Silver (May 2012 delivery) is at $31.23 per t oz – a $0.181 or 0.58% decrease as of 11:12*.
Daily Outlook and Analysis for April 30th
Gold and silver prices slightly increased on Friday and may change direction on the last day of the month. This may occur if the recent from Europe including Spain and monetary development will have an adverse effect on the Euro. Alternatively if the upcoming reports from China and Canada listed above will be positive and hit expectations they may curb the current decline in gold and silver prices and may even reverse the current downward trend.
Here is a reminder of the top events and reports that are planned for today and tomorrow (all times GMT):
09:00 – Euro Area Monetary Development
13:30 – Canada’s GDP by Industry
2:00– China Manufacturing PMI
04:30 – Reserve Bank of Australia – Cash Rate Statement
09:30 – GB Manufacturing PMI
15:00 – U.S. ISM Manufacturing PMI
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