Gold and silver prices didn’t do much during the past couple of weeks even though they have had sharp turns during that time. By the end of the month gold price shed 2.3% off its value and silver price declined by 6.23%. Currently gold and silver are trading up. This week will probably revolve around the U.S labor market and whether another rise in employment will ease the speculations around a stimulus plan by the Fed, which will likely to pull up gold and silver prices. In the meantime, there are several reports to come out today that may affect forex markets and indirectly gold and silver prices including: U.S. ISM Manufacturing PMI, Euro Area Unemployment Rate and Australian Retail Sales.
Here is a short forecast on gold and silver prices for Monday, April 2nd:
Gold and Silver– April Update
Gold price bounced back on Friday by 1.03% to $1,671; silver also traded up by 1.54% to $32.48. During March, gold declined by 2.3% and silver by 6.23%.
The chart above shows the changes in gold and silver prices during the past couple of weeks (prices are normalized to March 13th). The chart shows the fall and rise of precious metals prices.
The ratio between gold and silver edged down to 51.47. During the month the ratio rose by 4.19% as silver has underperformed gold. In the chart below are the changes in this ratio during the month.
On Today’s Agenda
10:00 – Euro Area Unemployment Rate: the Euro Area unemployment rate sharply rose from 10.3% in December to 10.7% in January; this report may affect Euro traders if there will be a sharp shift in this figure and in turn may also affect bullion prices;
15:00 – U.S. ISM Manufacturing PMI: This report will refer to the monthly development in the manufacturing sector on a national level during March 2012. During February 2012 the index edged down to 52.4%. but still means the manufacturing is growing (just at a slightly slower pace); this index might affect forex and commodities markets (see here my review of last PMI report);
02:30 – Australian Retail Sales: This monthly report will examine the developments inAustralia’s retail sales report for February 2012. the retail sales (seasonally adjusted) edged up by 0.3% in January; this news may affect the strength of the Aussie dollar which tend to be strongly linked with the daily changes of gold and silver;
Forex / Gold & Silver Market – April
The Euro/USD much like bullion prices slightly rose on Friday by 0.32% to reach 1.3344; on the other hand several other currecines pairs such as Aussie dollar/USD were also trading down. If the Euro/USD and AUD/USD pairs will continue to slightly rise today then it may also positively affect gold and silver prices.
Current Gold and Silver Prices April 2nd
Gold (May 2012 delivery) is traded at $1,683.6 per t oz. a $11.7 or 0.7% increase as of 15:55*.
Silver (May 2012 delivery) is at $33.13 per t oz – a $0.646 or 1.99% increase as of 15:55*.
Daily Outlook and Analysis
Gold and silver prices didn’t do much during the past couple of weeks but things may start to heat up again, especially if the speculations reignite again regarding another stimulus plan by the Fed that may come into play. Today, the EU employment rate will be released, and U.S factory orders and ISM manufacturing goods reports. These reports will show the progress of the U.S economy and if they will continue to grow it could lower the chances of another QE program and thus lowering gold and silver prices.
Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):
10:00 – Euro Area Unemployment Rate
15:00 –U.S.ISM Manufacturing PMI
02:30 – Australian Retail Sales
4:30 – Reserve Bank ofAustralia– Cash Rate Statement
15:00 – U.S Factory Orders
All day – G7 Meeting
19:00 – FOMC Meeting Minutes
2:30 – Australian Trade Balance
For further reading: