Tag Archives: unemployment

Oct 28

Price of Gold Weekly Recap – October 21-25, 2013

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Monday Open: $1,316.30
Weekly High: $1,353.40
Weekly Low: $1,312.30
Friday Close: $1,352.60

With the U.S. government reopened this week, backed up economic reports were released, positively influencing the price of gold. Thursday marked a four-week high and the week was overall bullish.

Monday opened the week near steady from last Friday’s closing numbers, with the market in anticipation of Tuesday when U.S. economic data was scheduled for release three weeks late.

Tuesday’s data encouraged the price of gold to make some significant gains. The main item on the list was September’s nonfarm payroll data, which showed less-than-expected growth. Unemployment was reported to have receded less than expected, which gives traders reason to believe the Fed will not begin its bond tapering program quite yet.

Wednesday’s gold prices slipped slightly on short-term profit-taking, but Thursday regained those losses and flew up to a four-week high on a few combined bullish factors. The dollar fell to a 10.5 month low on Thursday, bolstering the appeal of gold. Reports from China also gave indication that the holiday season will foster more consumer interest in buying gold.

Overall, gold experienced a strong week and traders are looking forward to next week’s FOMC two-day meeting.

Feb 04

Price of Gold Weekly Recap – January 28-February 1, 2013

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Monday Open: $1,654.50
Weekly High: $1,681.90
Weekly Low: $1,654.50
Friday Close: $1,667.90

It was a good week for gold after many U.S. economic reports and the Federal Reserve’s regular meeting concurred that the U.S. economy is not yet in a state of repair strong enough to push down gold. Following a bearish decline from last week, this week closed on a higher note than it opened.

Monday started off sluggish, a little flat on a relatively strong dollar. Most of Monday was spent in anticipation of news to come later in the week. Tuesday rallied a little bit as the dollar sunk slightly, and a Consumer Confidence report revealed worse than expected economic data – a 58.6 rating, well below the 64.0 expected mark.

Wednesday was the real day of growth for gold this week. The price of gold was bolstered by the Federal Reserve’s FOMC meeting, in which Chairman Ben Bernanke reiterated the low interest rates and bond-buying program that was set in motion at the end of last year. Concerns have arisen lately that the Fed might pull back on their quantitative easing should the economy show considerable improvement, but the U.S. GDP report released this week showed that the country’s economy had actually contracted 0.1% in the fourth quarter of 2012. Bernanke confirmed that interest rates would remain negligible until unemployment hits 6.5%.

Unfortunately for gold, the yellow metal gave back all its gains on Thursday, despite bullish factors in the marketplace like a weak dollar and poor economic data. Though no one single external factor can be pinpointed for this loss, the drop was probably due to profit-taking from short-term traders.

Friday saw a continued release of negative U.S. economic data, which gave a small spike to the price of gold. The U.S. jobless claims report missed their mark by 38,000, ticking the unemployment rate up to 7.9%. However, later in the day a stronger manufacturing report was released, undoing many of the slight gains that had occurred earlier in the day.

Next week, gold is predicted to stay in the $1,650 to $1,700 range, with the European Central Bank meeting on traders’ radar.

Oct 12

Price of Gold Weekly Recap – October 8-12, 2012

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Monday Open: $1,775.50
Weekly High: $1,775.50
Weekly Low: $1,754.10
Friday Close: $1,754.90

The price of gold this week fluctuated about $30 due to continuing uncertainty about the European debt crisis and the future of U.S. economic policy. Monday celebrated the American holiday of Columbus Day, so trading took a pause. There was slight risk-off trading, but the marketplace was quiet until Tuesday.

The yellow metal dropped about $10 on Tuesday after the International Monetary Fund lowered its predictions for world economic growth from 3.5% to 3.3%, reporting that the world’s industrial economies are at risk for a prolonged recession. Another reason for the drop on Tuesday was the ongoing conversation about Spain’s economic crisis, and uncertainty whether Spain really will ask for a bailout. After two days of meetings with eurozone finance ministers, no conclusion was reached and rioting continued in both Spain and Greece.

Last week, U.S. unemployment data revealed better than expected numbers, reporting that unemployment had dropped to 7.8%, so there is also some uncertainty for gold in this arena. Even though gold took a high turn a few weeks ago after Federal Reserve Chairman Ben Bernake agreed to third quarter quantitative easing, there is no guarantee how long his looser economic policies will last; the low interest rates and mortgage incentives are in place only until the U.S. labor market can show significant improvement.

Still, gold hovered in the upper $1,700 range this week. Wednesday was a general day of trading limbo, as some traders decided to sell off to reduce risk amid economic uncertainty, but the price remained fairly steady.

Thursday saw a slight jump for gold when U.S. economic data reported slightly higher jobless claims. Spain also had their credit score knocked down two points by credit rating agency Standard & Poor, but surprisingly the euro did not respond, and many continue to be optimistic that Spain will opt for a bailout.

It seems as if the U.S. if the major indicator of gold’s track upward or down, even though European and Chinese economies definitely play a hand in the cards. Still, the Fed’s decision to loosen monetary policy has been the singlemost significant factor for gold this year.

Stock market analyst Tom Kendall of Credit Suisse said, “Gold is going to take its biggest cue, as it has for the most recent past, from what happens in the U.S. in respect to the strength of the economic recovery and what that means for monetary policy.” He went on to say that it is fairly hard to predict the effect U.S. joblessness claims will have on gold now due to seasonality.

To recap the year so far, gold has risen about $215, or 13%, in 2012 with a majority of those gains, $165, occurring in the pas two months due to Fed monetary policy. Friday ended slightly lower but fairly quietly in trade-off anticipation of the weekend. Most polls show an even split as to how gold will perform next week.