GOLD, SILVER & PRECIOUS METALS MARKET WRAP

The price of gold has become one of the dominant themes in global markets over the past couple of years as the financial crisis unravelled. The Gold wrap reports on the latest trends in the price of the precious metal as well as factors influencing the demand for the safe haven asset.

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Gold mixed after US economic data

January 17 2013, 3:00pm
Gold mixed after US economic data

 

Gold was volatile after a bright start as US economic data came in better than expected while physical buying in Asia also eased.

Spot gold rose US$8.09 to US$US$1,687.84 as a rise in US monthly housing starts to a new four-year high in December was overshdowed by an unexpected fall in the Philly Fed manfacturing index.

Having been forecast to rise, the index fell to to minus 5.8 in January from plus 4.6 in December. 

Prior to that, construction started on 924,000 new homes, the highest monthly total since June 2008 and way ahead of market forecasts of about 880,000.

Housing is seen as a good indicator of underlying confidence in the economy, though the current figures are still some way short of the numbers seen five years ago.

There was also a surprise drop in new US dole claimants of 37,000 to 335,000, its lowest level for five years, though economists said numbers can be unreliable at this time of year.

US employment is a key criterion for the US Federal Reserve’s monetary easing programme and signs that both the economy and labour markets are improving will affect sentiment over gold said traders.

Platinum regained its price advantage over goldl. The spot platinum price firmed US$7 to US1,692 even though Anglo American said some strikers had returned to work after wildcat action following the announcement of the miner’s extensive retrenchment on Tuesday. 

Anglo, the world’s leading platinum producer, said it would slash 14,000 jobs and reduce capacity by 400,000 ounces on Tuesday to boost the performance of its Amplats arm.

Silver added US$0.20 to US$31.65.

Market movers

Randgold Resources (LON:RRS) down 83p at 5807p

Afrcian Barrick Gold (LON:ABG) down 0.5p at 348p

 


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