Gold and Silver – Daily Outlook for December 11th

The prices of gold and silver sharply rose on Tuesday. This recent rise was the second consecutive rise in prices. The recent reached agreement between Ryan and Murray to avert a potential U.S government shutdown in January along with FOMC’s member Bullard statements from yesterday that tapering is a valid option may have contributed to the recent recovery of gold and silver. Will gold and silver change direction? On today’s agenda: U.S. Federal Budget Balance, Australia Employment Update, and U.S 10 Year Bond Auction.

Here is a short overview for precious metals for Wednesday, December 11th:

Gold and Silver – December Review                          

On Tuesday, gold jumped by 2.18% to $1,261.8; Silver, by 3.21% to $20.27 – their highest level this month. During December, gold rose by 0.90%; silver, by 1.36%. In the chart below are the normalized rates of bullion for 2013 (normalized to 100 as of November 29th). The prices of gold and silver have rallied from last week’s decline.

Gold and silver Chart 2013  December 11The ratio between the two precious metals slipped on Tuesday to 62.25. During December, the ratio slightly fell by 0.45% as silver has moderately out-performed gold.

Gold  to silver ratio Chart 2013  December 11The gold and silver futures volumes of trade have risen and reached on Tuesday 154 thousand and 56 thousand, respectively. The volume of trade is likely to remain low in the coming days.

volume Gold & silver prices 2013  December 11

On Today’s Agenda

U.S 10 Year Bond Auction: The U.S government will issue its monthly bond auction; in the last auction, which was held during the second week of November, the average rate reached 2.75% – the highest rate since September 2013;

U.S. Federal Budget Balance: This upcoming report will refer to November 2013; this report suggests the government debt growth and thus may affect the changes in U.S dollar. In the previous report regarding October the deficit rose by $91 billion; if the deficit continues to expand, it could influence U.S policymakers their decision regarding next year’s budget cuts;

Australia Employment Update: In the recent report regarding November 2013 the rate of unemployment inched up to 5.7%; the number of employed (seasonally adjusted) slightly increased by 1,100 people. This report could affect the Aussie dollar (see here the recent report);

Currencies / Precious Metals Correlations – December Update

On Tuesday, the Eur/USD currency pair rose by 0.16% to 1.3761. During December, the Eur/USD increased by 1.25%. Further, other currencies such as the Aussie dollar also appreciated yesterday against the U.S dollar by 0.43%. The correlations among gold, silver and Euro have weakened in recent weeks, e.g. the correlation between the Euro/USD and gold price is 0.25 during November.  Nonetheless, the decline of the USD against other currencies could positively affect the prices of gold and silver.


Here is a reminder of the main events and publications that are scheduled for today and tomorrow (all times GMT):


Tentative – U.S 10 Year Bond Auction

19:00 – U.S. Federal Budget Balance

02:30 – Australia Employment Update


08:00 – Draghi’s Speech

08:30 – Libor Rate of Swiss National Bank

09:00 – ECB Monthly Bulletin

13:30 –U.S. Retail Sales Report

13:30 – U.S. Jobless Claims

18:05 –Governor Poloz speaks

For further reading:


Is the Golden Era of Gold Over?