Gold and silver prices didn’t react to the recent FOMC statement to keep policy unchanged. Both metals slightly declined yesterday, while many other commodities increased and the U.S dollar depreciated against the Euro and Aussie dollar. It seems that the market had already anticipated no headlines from the recent FOMC meeting; eventually it was just a storm in a teacup.
Currently gold and silver prices are increasing. On today’s agenda: U.S Pending home sales (update: pending home sales index rose by 4.1%), BOJ monetary policy update, U.S jobless claims (update: U.S jobless claims edged down to 388k), and the Italian auction bond sales.
Here is a short analysis and projection of gold and silver prices for Thursday, April 26th:
Gold and Silver– April Update
Gold price slipped on Wednesday by 0.09% to $1,642.3; silver even more than gold decreased by 1.27% to $30.43. During April, gold decreased by 1.77% and silver by 6.34%.
The chart below presents the changes of both precious metals during recent weeks (gold and silver are normalized to 100 as of March 30th).
The ratio between gold and silver rose to 53.98. During April the ratio increased by 4.88% as gold has outperformed silver during the month. In the chart below is the upward trend of this ratio during recent days.
On Today’s Agenda
U.S. Jobless Claims Update: in the previous update the jobless claims edged down to 386,000; this upcoming weekly report may affect the path of the US dollar and consequently gold and silver prices;
U.S. Pending Home Sales: In the previous report the pending home sales index declined by 0.5%. If the pending sales will decline, this may weaken the US dollar;
Italian 10 year bond Auction: this Auction will follow last week’s Spanish debt auction; if the Italian debt auction will go well it may ease some of the concerns regarding the EU debt crisis;
Bank of Japan –Monetary Policy Statement: Bank of Japan will announce its update on monetary policy. If the BOJ will introduce additional monetary stimulus plans, this may affect not only the Yen but also commodities prices;
Forex / Gold & Silver Market – April
The Euro/U.S Dollar edged up on Wednesday by 0.15% to 1.3217. During April Euro/U.S Dollar decreased by 1.0%; furthermore, the “risk currencies” including the Aussie dollar also slightly appreciated yesterday against the U.S. dollar by 0.37%. If the U.S dollar will change direction and depreciate against the abovementioned exchange rates, this may signal gold and silver will rise.
Current Gold and Silver Prices as of April 26th
Gold (May 2012 delivery) is traded at $1,651.4 per t oz. a $9.1 or 0.55% increase as of 09:35*.
Silver (May 2012 delivery) is at $30.87 per t oz – a $0.445 or 1.46% increase as of 09:35*.
(* GMT)
Daily Outlook and Analysis for April 26th
Gold and silver prices didn’t react to the FOMC meeting statement and the Press conference that followed. This might suggest that bullion prices will remain flat for the rest of the month. Up to now, gold and silver prices didn’t do well during the month. The upcoming reports from the U.S including jobless claims and pending home sales may positively affect bullion prices if these reports won’t be positive. Finally, if the Italian bond sale will go well it may also positively affect the Euro.
Here is a reminder of the top events and reports that are planned for today and tomorrow (all times GMT):
Today
13:30 – U.S. Department of Labor– Jobless Claims Weekly Update
Tentative – Italian 10 year bond Auction
15:00 – U.S. Pending Home Sales
15:30 – EIA U.S. Natural Gas Storage Report
Tentative – Bank of Japan –Monetary Policy Statement
Tomorrow
10:30 – KOF Economic Barometer
13:30 – First U.S GDP 1Q 2012 Estimate
Tentative – Bank of Japan Press Conference
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