Gold Fundamental Forecast – May 27, 2016

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Published: May 26, 2016, 10:25 UTC

Gold traded flat after the close of the Asian session. Gold gained in the early session adding close to $4 as traders took advantage of the declines to

Gold Fundamental Forecast – May 27, 2016

Gold traded flat after the close of the Asian session. Gold gained in the early session adding close to $4 as traders took advantage of the declines to buy up the cheaper commodity. Gold is sitting tight ahead of Janet Yellen’s speech on Friday. Gold is currently at 1227.45. The metal posted slight losses Wednesday, trading at a spot price of $1220.04 an ounce in the North American session. On the release front, Goods Trade Balance beat the estimate. Crude Oil Inventories surprised the markets with a decline of -4.2 million barrels, compared to the forecast of -1.2 million. Later today, the US releases unemployment claims and durable goods orders.

Gold continues to endure a very rough month of May, having shed 5.8% of its value and wiping out the gains recorded in April. Gold posted sharp losses on Tuesday after an excellent US housing report bolstered the greenback at the expense of gold. New Home Sales surged in April, with an excellent reading of 619 thousand. Gold is also under pressure as demand has fallen off sharply in India and China.

Gold bounced back from a six-week low by edging up, snapping its two-day losing streak, driven by a rising trend overseas amid scattered buying by jewelers at the domestic spot market. Silver also halted its 8-day falling trend and rebounded on increased off-take by industrial units and coin makers. According to traders, gold rebounded from the lowest level in seven weeks as a rally in the dollar paused, buoying sentiment.

According to a report in Bloomberg gold is at risk of taking a tumble as a resurgent dollar erodes demand with the Federal Reserve opting for not one, but two rate increases before the year-end, according to UBS Group AG’s wealth-management unit, which forecasts that bullion may drop back to $1,150 an ounce.

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.

Upcoming Economic Events that you should be monitoring:

Friday, May 27, 2016

Cur.	Event	Actual	Forecast	Previous
AUD	RBA Assist Gov Debelle Speaks
JPY	National Core CPI (YoY) (Apr)		-0.4%	-0.3%
JPY	Tokyo Core CPI (YoY) (May)		-0.4%	-0.3%
USD	GDP (QoQ) (Q1)		0.9%	0.5%
USD	GDP Price Index (QoQ) (Q1)		0.7%	0.7%
USD	Michigan Consumer Expectations		86.6	87.5
USD	Michigan Consumer Sentiment (May)		95.4	95.8
USD	Fed Chair Yellen Speaks
USD	Baker Hughes U.S. Rig Count			318