Gold Monthly Fundamental Forecast March 2013

Posted March 02, 2013 10:34 (GMT) | By FX Empire Analyst - Barry Norman | Print | Font Size
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Gold Monthly Fundamental Forecast March 2013

Outlook and Recommendation

Gold had an active month hitting a high of 1685.00 to close over 100 dollars below at 1578.70. Gold fell more than 1 percent on Thursday, as gains in U.S. equities and economic optimism sapped safe-haven demand for the precious metal, which ended February with its fifth straight monthly drop, the longest string of monthly declines since 1996. Bullion fell sharply for a second day, after U.S. data showed the economy grew slightly in the fourth quarter while new claims for unemployment dropped last week. Signs of an improving U.S. economy have sent the Dow Jones industrials and the S&P 500 stock index within striking distance of record highs. Gold fell 5 percent in February and bullion holdings in gold-backed exchange traded funds posted sharp monthly losses. Investors are reassessing where they have their money allocated at, and they are now focusing on the equity markets which have been holding up very firm.

Highest: 1685.65

Lowest: 1554.80

Difference: 130.85

Average: 1629.87

Change %: -5.90

Hedge funds and money managers increased their net long gold futures and options positions in the week to Feb. 26 after they cut them sharply in the previous period, according to CFTC. Specs raised net longs in gold by 11,861 lots to 54,180. Reflecting the negative sentiment among fund investors, an exodus from the SPDR Gold Trust the world’s biggest gold-backed exchange-traded fund, continued for a seventh consecutive session, marking the longest outflow in the fund’s history. What we are seeing just now is a lack of love from investors towards gold. Why would you be in a market that doesn’t pay any dividends and yield, and is most likely to underperform in an environment where economic indicators are seen improving? Bullion has struggled so far this year after 12 years of rising prices as signs of improving economic conditions in China and the United States. Stabilization in much of Europe has also lured investors away from safe-haven assets.

FxEmpire provides in-depth analysis for each currency and commodity 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 recent analysis and information in our weekly reports and we provide daily updates and outlooks.

Central Bank – Fed Reserve

Date of next meeting or last meeting: March 20, 2013

Current Rate: 0.00 – 0.25%

GOLD 0301M

Economic events for the month of February affecting EUR, CHF, GBP and USD

Date	Time	Currency	Event	Forecast	Previous
Mar 1	4:30	GBP	Manufacturing PMI	51.0	50.8
	10:00	USD	ISM Manufacturing PMI	52.7	53.1
Mar 4	4:30	GBP	Construction PMI		48.7
Mar 5	4:30	GBP	Services PMI		51.5
	10:00	USD	ISM Non-Manufacturing PMI		55.2
Mar 6	8:15	USD	ADP Non-Farm Employment Change		192K
Mar 7	3:00	CHF	Foreign Currency Reserves		427.0B
	7:00	GBP	Asset Purchase Facility	375B	375B
		GBP	Official Bank Rate	0.50%	0.50%
	7:45	EUR	Minimum Bid Rate	0.75%	0.75%
		USD	Trade Balance		-38.5B
		USD	Unemployment Claims		344K
	16:30	USD	Bank Stress Test Results
Mar 8	3:15	CHF	CPI m/m		-0.3%
	8:30	USD	Non-Farm Employment Change		157K
		USD	Unemployment Rate		7.9%
	20:30	CNY	CPI y/y		2.0%
Mar 12	4:30	GBP	Manufacturing Production m/m		1.6%
Mar 13	7:30	USD	Core Retail Sales m/m		0.2%
		USD	Retail Sales m/m		0.1%
Mar 14	3:30	CHF	Libor Rate	<0.25%	<0.25%
	7:30	USD	PPI m/m		0.2%
		USD	Unemployment Claims
Mar 15	7:30	USD	Core CPI m/m		0.3%
	8:55	USD	Prelim UoM Consumer Sentiment
Mar 19	4:30	GBP	CPI y/y
		GBP	PPI Input m/m
	7:30	USD	Building Permits
Mar 20	4:00	EUR	German ZEW Economic Sentiment
	4:30	GBP	Claimant Count Change
	7:30	GBP	Annual Budget Release
Mar 21	4:30	GBP	Retail Sales m/m
	7:30	USD	Unemployment Claims
	9:00	USD	Existing Home Sales
		USD	Philly Fed Manufacturing Index
	20:45	CNY	HSBC Flash Manufacturing PMI
Mar 22	3:30	EUR	German Flash Manufacturing PMI
	4:00	EUR	German Ifo Business Climate
Mar 26	7:30	USD	Core Durable Goods Orders m/m
	9:00	USD	CB Consumer Confidence
		USD	New Home Sales
Mar 27	4:30	GBP	Current Account
	9:00	USD	Pending Home Sales m/m
Mar 28	7:30	USD	Unemployment Claims
Mar 31	20:00	CNY	Manufacturing PMI

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About: FX Empire Analyst - Barry Norman

Barry produces a private Daily Market Review newsletter that is distributed around the globe to over 25,000 subscribers and recently published a book on Options Trading that is available from amazon.com

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