Gold and Silver Prices – Daily Outlook for May 14

The week started with little movement for both precious metals: the price of gold edged down while silver moderately increased. In the forex markets, the leading “risk related currencies” such as the Euro and Aussie dollar depreciated against the USD. In the equities markets the S&P500 index edged up. Will market volatility rise in the coming days? Yesterday, the U.S retail sales report came out and showed a moderate increase in retail sales during April. On today’s agenda: German ZEW economic sentiment and Australian Annual Budget Release.

Here is a short outlook for precious metals for Tuesday, May 14th:

Precious Metals – May Update                                   

On Monday, gold slightly fell by 0.16% to $1,434.3; Silver edged up by 0.16% to $23.68. During the May, gold declined by 2.57%; silver, by 1.92%.

In the chart below are the normalized prices of gold and silver for 2013 (normalized to 100 as of April 15th). The prices of gold and silver haven’t done much in recent weeks.

Gold & silver outlook 2013  May 14The ratio between the two precious metals slightly declined on Monday to 60.57. During the month, the ratio edged down by 0.67% as gold slightly under-performed silver.

Gold & silver ratio 2013  May 14The gold and silver futures volumes of trade have slightly increased on Friday to 267 thousand and 57 thousand, respectively. These numbers are still lower than the volume traded a couple of weeks back. If the volume will pick up today, this could suggest the volatility of prices of gold and silver due to high volume will increase. The chart below presents the volume of trading gold and silver futures in the CME during April and May. 

volume Gold & silver prices 2013  May 14On Today’s Agenda

German ZEW economic sentiment: The upcoming report will refer to the ZEW indicator of economic sentiment for Germany for April. In March the ZEW indicator for Germany sharply fell to 36.3 points; if Germany’s economic sentiment will fall further, the Euro will plausibly weaken against other currencies and consequently bullion rates;

Australian Annual Budget Release: this report will outline the government budget of Australia for 2013; if there will be a hike in the budget deficit it could have an adverse effect on the Aussie dollar;

Currencies / Bullion Market – May Update

The Euro/ USD fell on Monday by 0.11% to 1.2975. During the month, the Euro/USD decreased by 1.47%. Moreover, other currencies such as the Canadian dollar and Aussie dollar also depreciated yesterday against the U.S dollar by 0.06% and 0.73%, respectively. The correlations among gold, Canadian dollar and Aussie dollar remained robust: during recent weeks the linear correlation between gold and USD/CAD reached -0.66 (daily percent changes); the linear correlation between the gold and AUD/USD was 0.61 (daily percent changes). If these correlations will remain robust, the direction of the Aussie, Canadian dollar and Euro are likely to partly affect the direction of bullion prices.

Current Gold and Silver Rates as of May 14th

Gold (short term delivery) is traded at $1,433.3 per t oz. a $1 or 0.07% decrease as of 01:04*.

Silver (short term delivery) is at $23.62 per t oz – a 0.32% decrease as of 01:04*.

(* GMT)

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


10:00 – German ZEW economic sentiment

10:30 – Australian Annual Budget Release


09:30 – Great Britain Claimant Count Change

Tentative – Bank of England Inflation Report

10:00 –EU First Quarter GDP 2013

10:30 – Governor King speaks

13:30 – Canada Manufacturing Sales

13:30 – U.S. Producer Price Index

14:00 – U.S. TIC Long Term Purchases

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