Gold Fundamental Forecast – June 2, 2016

August Comex Gold futures extended its gains on Wednesday as the U.S. Dollar and stocks weakened.  The upside momentum created by Tuesday’s solid reversal drove gold to $1222.40, before prices retreated to finish at $1220.80, up $3.30 or +0.27%.

On Tuesday the market reversed to the upside after briefly trading below the psychological $1200.00 level. Prices were driven higher by safe haven buyers due to the steep decline in U.S. equity markets.

Prices were also boosted by position-squaring ahead of Friday’s U.S. Non-Farm Payrolls report which some believe will determine whether the Fed raises rates in June or July. The rally also suggests that traders may already have discounted a rate hike.

Among other precious metals, July Silver rose 0.07% to $16.005 per ounce. July Platinum and September Palladium were little changed at $980.90 an ounce and $545.85 per ounce respectively.

Later today, gold traders will get the opportunity to react to the latest U.S. Manufacturing PMI for May, the ISM Manufacturing PMI for May, and the latest Beige Book reading by the Fed.

U.S. Manufacturing PMI for May is expected to show a reading of 50.5, the same as the April reading. The ISM Manufacturing PMI for May is expected to come in at 50.4, down from the previous 50.8 reading.

A reading below the estimate will be bullish for gold because it will soften the chances of a June Fed rate hike. A reading above the estimate should boost the U.S. Dollar which will likely pressure gold prices.

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.

Today’s economic releases:

 

Upcoming Economic Events that you should be monitoring:

Thursday, June 2, 2016

Government Bond Auctions

Jun 01 10:30 Denmark Holds bond auction

Jun 01 11:30 Germany Eur 4bn 0% Apr 2021 Bobl

Jun 01 11:30 UK Gbp 2.75bn 1.5% 2021 Gilt

Jun 01 17:20 Sweden Announces details of bond auction on Jun 08

Jun 02 10:30 Spain Holds bond auction

Jun 02 10:50 France Eur 8-9bn 2.25% May 2024, 0.5% May 2026 & 3.25%

Jun 02 11:03 Sweden Sek 0.5bn 0.125% 2019 I/L & Sek 0.5bn 0.125% 2026 I/L bonds

Jun 06 13:00 Norway Details of bond auction on Jun 08

Jun 07 11:00 Netherlands Eur 4-6bn Jan 2022 DSL

Jun 07 11:00 Austria Holds bond auction

Jun 07 11:30 Germany Holds I/L bond auction

Jun 07 11:30 UK 4.5% 2046 Gilt

Jun 08 11:03 Sweden Holds bond auction

Jun 08 11:05 Norway Holds bond auction

Jun 08 11:30 Germany Eur 5bn Jun 2018 Schatz

Jun 08 17:20 Italy Announces details of bond auction

Jun 09 11:30 UK 0.125% 2036 I/L Gilt

Jun 09 17:20 Sweden Announces details of I/L auction on Jun 16

 

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