Gold and silver prices resumed their downward trend they have had during most of the month. Their sharpest drop came on Wednesday when gold and silver prices precipitately declined by 3.03% and 4.17% respectively. This decline came a day after the FOMC held its meeting and decided to keep its policy unchanged and not introduce any additional stimulus plan for now as the U.S. economy is showing signs of recovery. Since the expansion of the U.S money base was related to the rally in gold and silver prices, the decision of the Fed not to declare another expansion pulled down the prices of bullion. Other U.S related publications came out during the week such as the U.S PPI, Philly Fed manufacturing Index and U.S CPI. All these indexes were positive, but didn’t rise by a high rate and thus may have had only little effect on the financial markets including metals market. By the end of the week, gold price declined by 3.25% and silver by 4.7% and thus bringing the prices of precious metals to their level back in early January 2012. Finally, it was reported on Friday that India, the leading country in importing gold, raised the taxes on gold and platinum (but not on silver) from 2% to 4%. This was the second time this year India raised taxes on precious metals. This news may have also been among the factors to drag down the price of gold on Friday.
Here is a short summary of the changes in gold and silver prices between March 12th and March 16th 2012:
Precious Metals Prices Weekly Recap:
Gold price sharply fell during last week by 3.25%; further, during last week the average gold price reached $1,670 /t. oz which is 1.39% below the previous week’s average price of $1,694 /t. oz. Gold price ended the week at $1,655 /t. oz.
Silver price, much like gold, sharply declined on a weekly scale by 4.7%; furthermore, this week’s average price reached $32.90/t oz which is 2.14% below the previous week’s average $33.62/t oz.
During the week, the average daily percent change of gold price slightly decreased by 0.65%; silver price also decreased by an average daily rate of 0.94%.
In the following chart are the changes in gold and silver prices, which were normalized to 100 to the end of last week – March 9th. Gold and silver prices fell during most of the week.
The second chart shows the daily percent changes of gold and silver (or in other words the shifts around the trend). Gold and silver prices were traded down during Monday, Wednesday and Friday and both metals traded up on Thursday; their daily percent changes ranged between 1.7% gain to a 4.2% loss.