The prices of gold and silver changes direction again and bounced back yesterday after they have declined a day earlier. According to the recent U.S jobless claims update, initial claims declined last week 23k to 393k. Further, the recent U.S GDP estimate for the third quarter was high than the preliminary estimate: GDP grew by 2.7%. On the other hand, not all is well in the U.S. The recent talks of policymakers regarding the budget talks didn't lead to a decision; thus the fiscal cliff is still a concern that could affect the USD and commodities markets. On today's agenda: KOF Economic Barometer, German Retail Sales, Euro Area unemployment rate, Canada's GDP, U.S Personal Spending and China Manufacturing PMI.
On Thursday, gold price bounced back by 0.62% to $1,727.2; Silver price also increased by 1.97% to $34.35. During the month, gold edged up by 0.47%; silver rose by 6.29%.
The chart below shows the developments in the normalized prices of precious metals during the month (normalized to 100 as of October 31st). In recent days both precious metals zigzagged with an unclear trend.
On Today's Agenda
German Retail Sales: In October, retail sales rose by 1.5% - higher than many had anticipated; if this report will increase again then it might strengthen the Euro;
Euro Area Flash Estimate of Annual Inflation: the inflation in Euro Area declined to 2.5% during October. If the upcoming inflation rate estimate will fall, it may raise the chances of ECB cutting its interest rate next week;
Canada's GDP by Industry: In the recent report regarding August 2012, the real gross domestic product edged up by 0.1%. This report may affect the strength of the Canadian dollar currency which is strongly correlated with major commodities such as silver and gold;
U.S Personal spending: in the last report regarding September the personal income rose by 0.8%; disposable personal income also rose by 0.4%;
China Manufacturing PMI: According the recent report regarding October the Manufacturing PMI rose to 50.2; this means that China's manufacturing sectors expanded at a slow pace; the recent flash manufacturing PMI increased to a 13 month high. If this upcoming report will also present an additional growth, it could signal a rise in China’s economy.
For further reading: Why Isn't Gold Pulling Up?
By: Lior Cohen, M.A. in Economics, Commodities Analyst and Blogger at Trading NRG
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