Gold Fundamental Analysis December 12, 2012, Forecast

By:

Updated: Aug 21, 2015, 00:00 UTC

Analysis and Recommendations: Gold surprised speculators by dipping close to 6.00 to trade at 1708.55 after traders had pushed gold up yesterday ahead of

Gold Fundamental Analysis December 12, 2012, Forecast

Analysis and Recommendations:

Gold surprised speculators by dipping close to 6.00 to trade at 1708.55 after traders had pushed gold up yesterday ahead of the FOMC two day meet beginning today. Traders expect the US Fed to continue its easy monetary policy and to replace the expiring Operation Twist with and outright bond purchase program adding additional stimulus to the economy. This should be a positive for gold and weaken the US dollar. The DX index has been falling but neither gold nor the US dollar show any conviction of expectations. The US Fiscal Cliff continues to loom closer and closer as traders are sure that the immediate problems will be resolved they are unsure of the tax increases and their effects on assets and capital gains, so traders remain worried.

Many economists expect the Fed to announce monthly bond purchases of $45bn after its meeting on Wednesday. Gold benefits from an easy monetary policy as investors fear that repeated cash printing will damage the value of currencies, prompting them to seek safety in hard assets such as bullion. Gold has risen more than 9% so far this year amid monetary easing policies by the world’s central banks, especially the Fed and European Central Bank.

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 up to the data analysis and information in our weekly reports.

Economic Data December 11, 2012 actual v. forecast

Date	Currency	Event	Actual	Forecast	Previous
Dec. 11	GBP	RICS House Price Balance	-9%	-7%	-7%
	AUD	NAB Business Confidence	-9		-1
	EUR	French Non-Farm Payrolls (QoQ)	-0.3%	-0.3%	-0.3%
	INR	Indian Trade Balance	-19.3B	-19.1B	20.9B
	ZAR	South African Retail Sales (YoY)	1.00%	4.00%	4.70%
	HUF	Hungarian CPI (YoY)	5.2%	5.4%	6.0%
	EUR	German ZEW Economic Sentiment	6.9	-12.0	-15.7
	EUR	ZEW Economic Sentiment	7.6	0.1	-2.6
	CAD	Trade Balance	-0.2B	-1.0B	-1.0B
	USD	Trade Balance	-42.2B	-42.6B	-40.3B

Upcoming Economic Events that affect the CHF, EUR, GBP and USD

Date	Time	Currency	Event	Forecast	Previous
Dec. 12	07:00	EUR	German CPI (MoM)	-0.1%	-0.1%
	07:00	EUR	German CPI (YoY)	1.9%	1.9%
	07:45	EUR	French CPI (MoM)		0.1%
	09:30	GBP	Average Earnings Index +Bonus	1.9%	1.8%
	09:30	GBP	Claimant Count Change	7.0K	10.1K
	10:00	EUR	Industrial Production (MoM)	0.2%	-2.5%
	13:30	USD	Import Price Index (MoM)	-0.5%	0.5%
	19:00	USD	Federal Budget Balance	-147.5B	-120.0B
Dec. 13	08:15	CHF	PPI (MoM)	-0.3%	-0.1%
	11:00	GBP	CBI Industrial Trends Orders	-16	-21
Dec. 14	07:58	EUR	French Manufacturing PMI	45.0	44.5
	08:28	EUR	German Manufacturing PMI	47.2	46.8
	10:00	EUR	CPI (YoY)	2.2%	2.2%
	10:00	EUR	Core CPI (YoY)		1.5%