Base Metals, Industrial Metals and Precious Metals In The Green

As the month draws to an end, there is a serious lack of data on the calendar leaving traders trying to determine just how well the eurozone is recovering. Today, Spanish data is expected to show that Spain slipped out of recession. Later this morning the official statistics will be released which are estimated to show that GDP grew by .01%. Other than this the eurozone will see German employment numbers. US data will not hit the markets until late today which will culminate with the US FOMC statement. US data today includes leading indicator ADP’s non-farm payroll data along with CPI. Gold is trading flat at 1344.00 moving between small gains and losses as the US dollar gains as traders expect the FOMC to hold course.

Gold recovered this month on hopes that the Fed won’t slow asset purchases until next year after a government shutdown hurt the economy. Policy makers last month unexpectedly refrained from reducing stimulus. BlackRock Inc. Chief Executive Officer Laurence D. Fink said yesterday it’s imperative that tapering begins as the policy is contributing to “bubble-like markets.” Gold declined 20 percent in 2013, heading for the first annual loss since 2000. The U.S. central bank will pare the $85 billion in monthly bond buying at its March meeting, according to a Bloomberg survey of analysts on Oct. 17-18.

Holdings in the SPDR Gold Trust, the biggest bullion-backed exchange-traded product, were unchanged at 872.02 metric tons. Bloomberg’s U.S. Dollar Index, a measure against 10 currencies, was little changed today after climbing 0.4 percent on Tuesday. Silver continues to diverge from gold adding 25 points this morning to trade at 22.517 supported by a demand for industrial metals, which helped push copper up 12 pips to 3.292 moving slowly back to its consistent price of 3.30. LME Copper traded on a positive note by 0.3 percent yesterday as the orders to remove supplies from warehouses jumped the most in four months and LME inventories decline the most since 2009. Also, expectations of delay in QE taper supported an upside in prices of the red metal. A jump this morning in Japanese industrial production is helping the demand for metals. Japan’s industrial output rose 1.5 percent in September from the previous month, as stronger production of vehicles and electronic components added to signs the recovery in the world’s third-largest economy is gaining.

During the early morning session, base metals are trading slightly positive in the range of 0.2% to 0.4% at the LME on the back of positive cues from Asian equities which are trading higher. Coming to the commodity-specific updates, speculators maintain a negative view on copper as the global mine production increased by 8% in the first eight months itself on a year on year basis according to ICSG.