Gold and silver prices resumed their downward trend on
Monday as they have declined in the past five out of sic business days.
The results in the French and Greek elections may have had a slight
negative effect on the Euro, which in turn may have also adversely
affected commodities prices. Despite the decline in gold prices, China’s imports of gold from Hong Kong continue to surge in the first quarter of 2012. Currently gold and silver prices are tumbling down.
On today’s agenda: Australian trade balance report, ECB President speaks and Australian annual budget release.
Here is a short analysis for gold and silver prices for Tuesday, May 8th:
Gold and Silver– May Update
Gold price slipped on Monday by 0. 37% to $1,639.1; silver also declined by 1.02% to $30.12. During the month gold decreased by 1.51% and silver by 2.88%.
In the chart below are the normalized prices of bullion during the
past few weeks (gold and silver are normalized to 100 as of April 30th).
The ratio between gold and silver slipped to 54.42. During the month the ratio rose by 1.41% as gold has moderately outperformed silver during the month. In the chart below are the changes of this ratio during May.
Australian Trade Balance Deficit Rose Again in March 2012
According to the recent report regarding March 2012, the seasonally
adjusted balance of goods and services expanded from a deficit of $754
million in February 2012 to a $1,587 million deficit in March 2012.
The export of non-monetary gold rose again by $75
million (6%); as gold exports continue to expand, this might suggest a
rise in demand for non-monetary gold despite the recent decline in gold prices;
On Today’s Agenda
ECB President Draghi Speaks: Following the ECB rate decision
to keep in unchanged at 1% the President of the European Central Bank,
Mario Draghi will speak; his speech may include the recent events in
Europe and may talk about the ECB’s monetary plan if he will refer to
implementing LTRO 3 this may affect the Euro/USD, which is strongly linked with gold and silver prices;
Australian Annual Budget Release:
this report will outline the government budget of Australia for 2012;
if there will be a hike in the budget deficit it could have an adverse
effect on the Aussie dollar;
Foreign Exchange / Gold & Silver Market – May Update
The Euro/U.S Dollar slipped again on Monday by 0.24% to 1.3051. During the month so far the Euro/U.S Dollar
decreased by 1.42%; on the other hand, the Canadian dollar and Aussie
dollar slightly appreciated on Monday against the U.S. dollar by 0.29%
and 0.17%, respectively. Since the Euro, Aussie dollar and Canadian
dollar are strongly and positively correlated with gold and silver prices (see the chart below for the linear correlations among these currencies of
the daily percent changes during April and May), if the U.S dollar will
appreciate against these exchange rates; this may continue to affect gold and silver prices to decline. Currently the Euro is decreasing against the USD.
Here is a reminder of the top events and reports that are planed for today and tomorrow (all times GMT):
2:30 – Australian Trade Balance
10:30 – Australian Annual Budget Release
15:30 – ECB President Draghi Speaks
Tomorrow
00:30 – Japan Current Account
15:30 – U.S Crude Oil Stockpiles Report
18:00 – 10 Year Bond Auction
2:30 – Australia Rate of Unemployment
Source; http://www.tradingnrg.com/gold-prices-outlook-silver-price-forecast-tuesday-may-8th-2012/
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