Gold and Silver Outlook for April 17

by Lior Cohen
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Submitted by Trading NRG as part of our contributors program.

Gold and silver bounced back from their tumble of the past couple of business days. This may have just been a correction to the sharp fall in their prices. Yesterday, the U.S CPI report was published: the U.S CPI fell by 0.2% in March on account of the drop in energy prices. The core CPI remained stable and inched by 0.1%. This is another indicator for the stability of U.S prices, which could ease the concerns regarding the Fed’s current asset purchase program (for now at least). Housing starts report came out and showed a gain in housing starts during March. Will gold and silver resume their downward trend? On today’s agenda: Great Britain Claimant Count Change, Minutes of MPC Meeting, German 10 Year Bond Auction, Bank of Canada’s Overnight Rate and Japanese trade balance.

On Tuesday, the price of gold bounced back and rose by 1.93% to $1,386.8; silver also increased by 1.14% to $23.63. During April, gold declined by 13.04%; silver, by 16.49%. Usually following such sharp falls in the prices of gold and silver, they tend to rise.

The ratio between the two precious metals rose again on Tuesday to 58.69. During April the ratio rose by 4.12% as gold slightly out-performed silver.

On Today’s Agenda

Bank of Canada’s Overnight Rate: The Bank of Canada will announce its decision on the Canadian overnight rate, which remained flat in recent years at 1%. The BOC may keep its policy and maintain its interest rate at 1%; the latest slowdown inCanada’s economy might prompt BOC to reduce the rate;

Minutes of MPC Meeting: in the latest MPC meeting, the Bank left the rate unchanged at 0.5% and the asset purchase program at £375 billion; the MPC still has concerns regarding GB’s inflation. The minutes of last week’s meeting might offer some insight behind this decision;

Japanese Trade balance: The Japanese trade balance deficit for February 2013 rose by 47.4% compared to January, and reach 1,086 billion YEN (roughly $11.08 billion) deficit (seasonally adjusted figures). This rise is due to the higher growth in imports (by 6.8%) than in exports (by 1.3%).Japan is among the leading importers countries of commodities, such as gold;

For further reading:

Will These Gold Producers Bounce Back?

Is it Time to Sell Gold?

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