Gold Fundamental Forecast – April 21, 2016

There was not much movement in June Gold futures after earlier weakness in the Asian session. The market began today’s session higher, but it gave back its gains after the U.S. Dollar firmed. Lower crude oil prices also contributed to the weakness.

After trading as high as $1259.80 and above yesterday’s high, the market finished at $1249.70, down $4.60 or -0.37%.

On Tuesday, the metal was supported by data that showed U.S. housing starts fell more than expected in March and permits for future home construction hit a one-year low. This news drove the dollar sharply lower because it supported the notion that the Fed would raise interest rates gradually.

Gold was also underpinned by a surge in silver prices. The July futures contract rallied to an 11-month high on Wednesday. Silver is getting its support from industrial demand and speculative buying from China.

July Comex Silver futures continue to attract buyers, closing at $17.02, up $0.048 or +0.28%.

The most traded silver contract on the Shanghai Gold Exchange rose for a tenth session out of 11, climbing about 3 percent on Wednesday to a six-month top.

Assets in silver-backed exchange traded funds are near their highest since 2004, supporting the price rally. The six silver ETFs tracked by Reuters have seen inflows of nearly 30 million ounces since the beginning of the year.

Additionally, speculators have been buying more silver than gold recently because of the distorted price ratio. They feel that silver is a bargain at current levels relative to its historical price relationship to gold.

Gold is likely to be underpinned by rising silver prices today. A sharp break in the U.S. equity markets could also send traders into gold. However, gold’s gains will be limited if the stock indices recover and move back towards all-time highs.

FxEmpire provides in-depth analysis for each asset we review. Fundamental analysis is provided in three components. We provide a detailed monthly analysis and forecast at the beginning of each month. Then we provide more up to the data analysis and information in our weekly reports, which covers the current week and are published by Sunday before the new week begins. Daily we share any new events, forecasts or analysis that affect the current day. To achieve a full accurate understanding it is important that you study all of our data and analysis as a whole.

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Wednesday, April 21, 2016

Government Bond Auctions

Date Time       Country           Auction

Apr 20 10:30 Denmark 1.75% 2025 bond

Apr 20 11:05 Norway Nok 3bn 2019 bond

Apr 20 11:30 Germany Eur 4bn 0.5% Feb 2026 Bund

Apr 20 11:30 UK Gbp 1.4bn 0.125% 2026 I/L Gilt

Apr 20 17:20 Italy Details of BTPei auction

Apr 20 17:20 Sweden Details of bond auction on Apr 27

Apr 21 10:30 Spain Holds bond auction

Apr 21 10:50 France Holds bond auction

Apr 21 11:03 Sweden Sek 0.5bn 1% 2025 I/L & Sek 0.5bn 0.125% 2019 I/L bonds

Apr 21 11:50 France Holds I/L bond auction

Apr 21 19:00 US Holds 5-year TIPS auction

Apr 22 17:20 Italy Announces details bond auction

Apr 25 N/A UK 2.5% July 2065 Gilt (Syndicated tap)

Apr 25 11:35 Germany Eur 1.5bn Apr 2017 Bubill

Apr 26 11:10 Italy Holds BTPei auction

Apr 26 19:00 US Holds 2-year note auction

Apr 27 11:03 Sweden Holds bond auction

Apr 27 11:10 Italy Holds CTZ auction

Apr 27 11:30 Germany Eur 1bn 2.5% Aug 2046 Bund

Apr 27 19:00 US 2-year FRN, 5-year note auctions

Apr 28 11:10 Italy Holds 5yr/10yr bond auctions

Apr 28 19:00 US Holds 7-year note auction