Gold price continued to decline yesterday, while silver price changed direction and slightly rose yesterday. Both precious metals prices didn’t do well in recent weeks, but will they continue to trade down on the last business day of 2011? Or will there be a correction to the recent downward trend of precious metals prices? Currently, gold and silver are traded up. Today, China’s Manufacturing PMI report will be published.
Here is a market outlook of precious metals prices for today, December 30th:
Gold and Silver Prices –December Update
Gold price sharply fell on Thursday by 1.48% to $1,540.9; gold price has fell for the past six consecutive business days; silver price on the other hand slightly rose by 0.30% to reach $27.32. The chart below presents the development of gold and silver prices during December (normalized gold and silver prices to November 30th 2011). During December gold price decreased by 12% and silver price by 16.7%.
Despite the different directions of gold and silver prices recorded yesterday, their linear correlation between their daily percent changes continues to be high in December as it was in previous months.
U.S. Pending Home Sales Rose again in November 2011
According to the last U.S. pending homes sales report the market continues to rally as the pending home sales index rose by 7.3% in November compared with the October’s. The November 2011 index was also 5.9 percent above the November 2010 index that stood back then at 94.5. This servers as another indicators to the progress of the U.S. real estate markets and thus may have helped trade down precious metals.
U.S. Initial Claims Inclined Last Week
Yesterday, December 29th, according to the recent U.S. jobless claims report, the initial claims rose of 15,000 for the week ending on December 24th; the total initial claims reached 381,000 claims (seasonally adjusted data); the number of insured unemployment reached 3.601 million, an increase of 34,000 compared with the previous week’s figure; This news may have affected the forex trading during yestredy and curbed the appreciation of the US dollar.
On Today’s Agenda
China Manufacturing PMI: this index will cover 800 companies in 20 industries in China; according to the HSBC Manufacturing PMI report regarding November the Manufacturing PMI continued to decline and reached 47.7 which is a 32 month low and sharply lower than the October index of 51.; this index indicates the changes in China’s manufacturing sectors growth rate (see here last China’s GDP report);
Forex Trading / Gold & Silver Prices – December
The Euro to U.S Dollar slightly rose on Thursday by 0.15% to reach 1.2961. Furthermore, other forex exchange rates such as the Australian dollar and Canadian dollar also moderately appreciated against the U.S dollar. If major currencies will appreciate against the U.S. dollar, it may also affect gold and silver prices to rise.
Current Gold and Silver Prices December 30th
The major precious metals are currently rising in the Asian markets:
Current gold price per ounce short term future (January 2012 delivery) is traded at $1,560.00 per t oz. a $19.1 or 1.24% increase as of 02:07*.
Current silver price per ounce short term future (January 2012 delivery) is at $27.680 per t oz – a $0.365 or 1.34% increase as of 02:07*.
Gold and Silver Prices Outlook:
Gold and silver prices didn’t do well in December and more so in the past several days. The recent U.S unemployment claims may have helped curb the recent appreciation of the U.S dollar and thus also curbed the sharp drop in gold and silver prices.
As we are existing 2011, unless the U.S. dollar will trade down against other currencies such as the Australian dollar and Euro, or a sharp move by speculators to correct the recent drop in gold price, I speculate it is likely that bullion prices’ downward trend will continue.
Here is a reminder of the top events and reports that are planed for today (all times GMT):
2:00– China Manufacturing PMI
For further reading:
- Gold and Silver Prices Weekly Outlook for December 26-30
- Weekly Outlook for 26-30 December
- Where are Gold and Silver Headed in 2012?