Gold & Silver Prices – Daily Outlook 1 July

Gold and silver prices finished June with moderate changes, but already started off July with falls. As we are entering the long weekend, what will gold and silver prices do today? The European unemployment report will be published today along with the US durable good report.

Let’s examine the news of the day related to the precious metals market for today July 1st:


Gold and silver prices – June/July


Gold price shifted direction again and closed the month of June with moderate falls on Thursday, June 30th as it declined by 0.90% to $1,496.

Silver price on the other hand inclined on Thursday by 0.18% to $34.83.These changes are very modest so they continue to demonstrate a slow paced movement by bullion metals’ prices.

During June, gold price decreased by 2.6%, and silver price declined by 9.1%.

The chart below shows the normalized gold and silver prices (May 31st 2011=100).

It shows how silver price tumbled down in three steps: at the beginning, middle and near end of June. Actually, during the last few days of June, silver price bounced back a bit. Gold price, on the other hand, was much more stable and had its sharpest fall during the penultimate week of June.


Gold prices forecast & silver price outlook 2011 JULY 1

The gold to silver ratio: As of Thursday, June 30th the ratio between gold and silver prices continued to remain unchanged as it reached 42.97; during June this ratio inclined by 7.1%, which means that during June gold price has outperformed silver price.

Gold prices forecast & silver price outlook ratio 2011 JULY 1

US Dollar and Gold and silver prices – July update

The US dollar continues to depreciate against the Euro, following the Greek voting during the week. If this will continue today, this might affect gold and silver prices to incline.  Nonetheless, since the Euros to US dollar is traded down very moderately, its effect on gold and silver prices might be little.

US Durable Goods report

Today, the U.S. durable good report will be published regarding May. This report indirectly shows the changes in U.S. demand for goods including major commodities such as crude oil. In April 2011, there was decrease in manufactured durable goods by $7.1 billion or 3.6% to $189.9 billion; Non-defense new orders for capital goods decreased by $5.3 billion or 7.3% to $67.6 billion.

This report was suggested to have an effect on the yields of US treasury bonds according to Balduzzi, Elton, and Green (2001); if this will be the case, it might also have an indirect effect on gold and silver prices, if the results in this report will be a surprise.

European unemployment report

This report will show the changes of unemployment rate in Euro area during May 2011. For the month of April, the unemployment rate remained unchanged at 9.9%, i.e. 15.529 million people were unemployed in the Euro Area. This figure is lower than the rate of April 2010, which stood then on 10.2%. In the EU27, 22.547 million people were unemployed during April 2011. If the report will show again no improvement this will likely to have little effect on Euro/USD and consequently won’t affect much gold and silver prices.

Current Gold and Silver prices

The precious metals prices are currently traded down in the European markets:

The current gold price, short term futures (July 2011 delivery) is traded at $1,494.4 per t oz. with a $8.4 decrease or 0.56% as of 10:08*.

Current silver price, short term futures is at $34.31 per t oz – a $0.562 decline or 1.61%, as of 10:08*.

The current ratio of gold to silver prices is at 43.55.

(* GMT)

Gold and silver prices Outlook:

Gold and silver prices ended June with light changes and July might bring new changes; one of the key factors will remain the USD effect on bullion metals prices’; the upcoming US durable report might have some small effect on gold and silver prices along with the Euro unemployment report via the changes in the Euros to US dollar exchange rate. But as we are entering the long weekend it’s likely that there will continue to be little changes in gold and silver prices today.

I still speculate that in the mid term gold prices will remain near the $1,500 mark and silver price will level out at $33-35 mark.

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

13:30 – US Department of Commerce – Report on Durable Goods


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