Last week started with sharp gains for gold and silver, but this week started with very modest gains. In the coming days, however, the volatility might start to pick up, which could result in sharper movement in the prices of gold and silver. Today the FOMC meeting will commence. The Fed’s meeting will conclude tomorrow that will follow a statement. Until then, the U.S housing data weren’t too positive as pending home sales index slipped by 0.4% to 110.9 in June. This news, however, didn’t stir up the markets. It seems that the markets remain poised for the FOMC meeting statement, the ECB rate decision and non-farm payroll report that will come out later this week. On today’s agenda: Governor Stevens speaks, German Consumer Climate and U.S Consumer Confidence.
Here is a short outlay for precious metals for Tuesday, July 30th:
Gold and Silver Prices Review – July Update
On Monday, gold slightly rose by 0.52% to $1,328.40; Silver also bounced back by 0.46% to $19.85. During July, gold rose by 8.55%; silver, by 2.06%.
In the chart below are the normalized prices of gold and silver for 2013 (normalized to 100 as of June 28th). The prices of gold and silver have moved in an unclear trend in recent days.
See here the weekly outlook of gold and silver for July 29- August 2.
The gold and silver futures volumes of trade reached on Friday 251 thousand and 43 thousand, respectively. These numbers are higher than the volume traded in the past couple of weeks. If the volume will continue to increase, this could pressure up the volatility of bullion prices. The chart below shows the volume of trading gold and silver futures in the CME during June and July.
On Today’s Agenda
Governor Stevens speaks: Reserve Bank of Australia Governor will give a speech at the Anika Foundation Luncheon supported by the Australian Business Economists and Macquarie Bank, in Sydney; in his upcoming talk, the Governor may refer to the recent RBA monetary policy meeting, in which the RBA left its interest rate flat; this speech may affect the Australian dollar, which is strongly linked with gold and silver;
Gfk German Consumer Climate Survey: This survey estimates Germany’s consumers’ economic climate including past and future economic conditions (on a monthly basis) for July. In the recent report for June 2013, the climate index slightly rose to 6.8;
U.S Consumer Confidence: Based on the latest monthly update, for May, the consumer confidence index rose to 81.4 (month-over-month). The current expectations are that the June index may further rally; this report might affect bullion prices;
Currencies / Bullion Market – July Update
The Eur/ USD currency pair changed direction and slipped on Monday by 0.13% to 1.3262. During July, the Euro/USD rose by 2.07%. Further, other currencies such as the Aussie dollar also slightly depreciated yesterday against the U.S dollar by 0.57%. The correlations among gold, Euro and Aussie dollar remained strong, e.g. the correlation between the Euro/USD and gold price is 0.57 during July. The chart below shows the linear correlations among precious metals and leading currency pairs during the month (up-to-date).
Current Gold and Silver Rates as of July 30th
Gold (short term delivery) is traded at $1,325.30 per t oz. a $4.30 or 0.32% decrease as of 07:30*.
Silver (short term delivery) is at $19.75 per t oz – a 0.60% decrease as of 07:30*.
Here is a reminder of the top events and publications that are scheduled for today and tomorrow (all times GMT):
04:45 – Governor Stevens speaks
09:00 – Gfk German Consumer Climate Survey
15:00 – U.S Consumer Confidence
07:00 – German Retail Sales
08:00 – KOF Economic Barometer
10:00 – EU CPI Flash Estimate
10:00 – EU Unemployment Rate
13:15 – ADP estimate of U.S. non-farm payroll
13:30 – Canada’s GDP by Industry
13:30 – First U.S GDP 2Q 2013 Estimate
19:00 – FOMC Meeting
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