The precious metals market continued to cool down as the prices of gold and silver fell down again for during yesterday’s trading. The recent economic reports from the U.S showed a mixed message regarding the progress of the U.S economy. Producer price index fell by 0.2% to an annual rate of only 0.3%. The PPI excluding energy and food slightly rose by 0.2% during last month. This means, prices aren’t rising. Moreover, the Philly fed index fell during November from 19.8 to 6.5. This is another sign for little progress in the U.S economy. Conversely, jobless claims fell by 21k to 323k. This is a positive sign for the progress in the labor market. In any case, the decline of precious metals coincided with the depreciation of several currencies against the USD indulging Aussie dollar and Japanese yen. On today’s agenda: Canada CPI, Canada Core Retail Sales, and German Ifo Business Climate Index.
Here is a short review for precious metals for Friday, November 22nd:
Gold and Silver – November Review
On Thursday, gold declined again by 1.14% to $1,243.6; Silver, by 0.62% to $19.93 – its lowest rate since the beginning of August. During November, gold fell by 6.04%; silver, by 8.69%. In the chart below are the normalized rates of gold and silver for 2013 (normalized to 100 as of October 31st). The prices of gold and silver have declined during the month.
The ratio between the two precious metals slipped on Thursday to 62.39. During November, the ratio rose by 2.9% as silver has moderately under-performed gold.
On Today’s Agenda
German Ifo Business Climate Index: This index comprises of the shifts (on a monthly basis) in the manufacturers, builders, wholesalers, and retailers in Germany as of November. In the last report regarding October 2013, the business climate index inched up from 107.7 in September to 107.4 in October;
Canada CPI: According to the last report, the annual core CPI rose to 1.3% and the CPI increased to 1.1% in the past twelve months; if the inflation continues to rise, this may affect the BOC’s monetary policy;
Canada Core Retail Sales (September 2013): This report will refer to the manufacturing sales in Canada as of September. In the previous report regarding August 2013, manufacturing sales rose by 0.4%;
Currencies / Precious Metals Correlations – November Update
On Thursday, the Eur/USD currency pair changed direction and slightly rose by 0.32% to 1.3482. During November, the Eur/USD slipped by 0.75%. Conversely, other currencies such as the Aussie dollar depreciated yesterday against the U.S dollar by 1.07%. The correlations among gold, silver and Euro remained robust in recent weeks, e.g. the correlation between the Euro/USD and gold price is 0.50 during October/November.
Here is a reminder of the main events and publications that are scheduled for today (all times GMT):
Today
09:00 – German Ifo Business Climate Index
13:30 – Canada CPI
13:30 – Canada Core Retail Sales
For further reading:
- Gold and Silver Outlook for November 2013
- Gold and Silver Weekly Forecast for November 18-22
- Weekly Outlook of Financial Markets for November 18-22
- Gold and Silver Yearly Outlook For 2013