Metals Pack Weekly Fundamental Analysis February 3 – 7, 2014 Forecast – Silver & Copper

Weekly Analysis and Recommendations:

Silver tumbled to the low $19 range but looked to be headed below as markets moved back to the US dollar. Silver ended the week at 19.108. Copper eased to $3.20. Copper dropped 4 percent this month after rising in the last two quarters of 2013, as signs of slowing economic expansion in China rekindle demand concerns. Global production will outstrip use by 167,000 metric tons this year, following a deficit of 137,000 tons in 2013, Barclays Plc has said

Base metals are likely to trade sideways with some short covering at the lower levels. Fed tapering and lower than expected home sales figures from US pressurized the prices lower. Pending home sales slumped by 8.7 percent in December as compared to a fall of 0.3 percent in November. Red metal, copper can trade in a low range. No. 1 copper producer Chile produced around 5.8 million tonnes of the metal last year, a 6.1 percent increase from 2012 levels and a fresh record. Japan’s December 2013 copper exports fell down by 11.7 percent. Copper net imports from China stood at 2.91 million tonnes in 2013.

Indonesia’s ban on exporting metal ores set to boost costs of the raw material bauxite and pile more pressure on struggling smelters. Some big U.S. banks, including Citigroup, were caught off guard due to an unprecedented surge in physical aluminum prices in January, forcing them to scramble to buy up physical supplies to satisfy hedging deals with industrial companies. Healthy auto sales growth in the U.S. and China, higher industrial battery demand growth in China, ongoing mine production challenges and flat Chinese refined lead production can extend support to the prices.

 

Copper fell for an eighth session in London, the longest slump since December 1998, on concern that slowing economic growth will curb demand in China, the world’s largest user of the metal.

Chinese factory output, as measured by a gauge the government will release tomorrow, probably slowed in January for a second straight month, according to analyst estimates. A private measure on Jan. 30 showed manufacturing contracted this month. Copper analysts are the most bearish in a year and expect prices to drop next week as markets in China shut for the Lunar New Year holiday, a Bloomberg News survey showed.

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.

Historical: From 2011 to present

Highest: 44.188 on Aug 22, 2011

Average: 31.108 over this period

Lowest: 18.183 on Jun 28, 2013

 

Major Economic Events for the week of January 27 – 31 actual v. forecast for Euro, GPB, and USD

 

Economic Highlights of the coming week that affect the Euro, GBP and the USD

Government Bond Auction

Date Time Country 

Feb 03 10:00 Norway

Feb 03 10:03 Sweden

Feb 04 10:03 Sweden

Feb 04 10:15 Austria

Feb 04 10:30 Belgium

Feb 04 10:30 UK

Feb 05 10:30 Germany

Feb 05 16:00 US

Feb 06 09:30 Spain

Feb 06 10:03 Sweden

Feb 07 10:03 Sweden

Feb 07 16:30 Italy