Gold Fundamental Analysis December 25, 2012, Forecast

Analysis and Recommendations:

Gold closed the short trading day ahead of the Christmas holiday at 1.662.65 adding 2.55 as it spent the day between small losses and gains without much direction or events in the markets Concerns over the looming fiscal cliff have only fueled interest in the precious metal. Some experts expect gold prices to go up next year which would mark a dozen years of price increases. However, not everyone is on the same page with respect to the outlook for gold prices. Capital Economics issued a report this week in which it addressed numerous factors that affect gold prices. Among them was European regulators willingness to see gold as a very high quality liquid asset. The report said, “Increased demand for gold to meet the tougher liquidity requirements could then go some way towards mitigating what might otherwise have been a large downside risk when the authorities do eventually take away the exceptional liquidity they have provided to the banking system.” Central banks play a central role in how things pan out for gold prices and they have been actively buying the precious metal. The firm said, “central banks continued to accumulate gold in October as well, with nearly 40 metric tons purchased in the month.” It went on to say, “accelerating deflationary trends, a stronger U.S. dollar, global central bank withdrawals of liquidity and a reversal of net bullion purchases, positive real interest rates, further delayed timing of development projects and higher than expected cost pressures could impact valuation.”

Markets are closed tomorrow and there will be light trading and limited volume throughout the week as traders will watch the US lawmakers closely for clues on progress.

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 24, 2012 actual v. forecast

There were no top tier economic events on Monday as global markets closed early for the Christmas holiday. Japanese markets are closed all day for a regional holiday.

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

Global markets are closed for the Christmas Holiday; many will reopen on Wednesday while some countries are out for additional days. There is no eco data on the calendar for December 25^th. We will not print any fundamental analysis on Christmas day and will return on December 26^th. I would like to wish all of my readers an enjoyable holiday season.

Government Bond Auction

Date Time Country 

Dec 26 01:30 Japan 

Dec 27 10:10 Italy  

Dec 28 10:10 Italy