Gold and Silver Outlook for June 20
Submitted by Trading NRG as part of our contributors program.
Gold and silver remained flat during most of the day but the latest press conference of the Fed stirred up the forex markets. This press conference is among the reasons for the current sharp drop of gold and silver. Bernanke stated that the Fed may ease down QE3 in the coming months. In Asia,China’s flash manufacturing PMI report came out in which manufacturing sector fell at a faster pace in June. The PMI index fell to 48.3 in June compared to 49.1 in May. This news is also likely to drag down precious metals prices today. On today’s agenda: Libor Rate of Swiss National Bank, Flash German, French and Euro Zone Manufacturing, GB Retails Sales, Euro-Group Summit, U.S. Existing Home Sales, Philly Fed Manufacturing Index, and U.S. Jobless Claims.
On Wednesday, gold slightly rose by 0.51% to $1,373; Silver declined by 0.25% to $21.68. During June, gold declined by 1.36%; silver, by 2.72%.
Fed may taper QE3 by the end of 2013
The FOMC published its statement and left its policy unchanged. Nonetheless, in the press conference that followed Bernanke stated that if economic conditions will continue to improve, the Fed may taper its current asset purchase program by the end of 2013. Moreover, the Fed may end QE3 by mid-2014.
The potential tapering of QE3 isn’t new: Bernanke’s testified earlier this month that tapering the current asset purchase program isn’t off the table and could be decided in the next several FOMC meeting.
On Today’s Agenda
Flash German, French and Euro Zone Manufacturing PMI: In the previous monthly report regarding May 2013, the German PMI rose to 49 i.e. the manufacturing conditions are shrinking at a slower pace. This report serves as an indicator to the economic developments of the Euro Area’s leading economies’ manufacturing conditions; this news, in turn, may affect the Euro/USD currency pair and consequently commodities;
U.S. Jobless Claims Weekly Report: in the previous report the jobless claims declined by 12k to reach 334k; the next weekly report may affect the U.S dollar and consequently commodities and equities markets;
Philly Fed Manufacturing Index: This monthly survey estimates the growth of the US manufacturing sectors. In the previous survey regarding May, the growth rate slipped from 1.3 in April to -5.2 in May. If the index will increase it may positively affect not only U.S Dollar but also American equity markets and commodities (the previous Philly Fed review);
For further reading: