Gold, Silver & Platinum Trading In The Green

Precious metals are trading in the green as the new week kicks off. Traders are preparing for the final meeting between Greece and the Eurogroup. At present this is the last scheduled meeting ahead of the Feb 28^th deadline as the bailout agreement ends and will leave Greece without funds.  Most investors believe that an agreement will be reached as Greek officials seem to be throttling back on their rhetoric. The US dollar has been easing since last Thursday after lackluster data brought into question the timing for an interest rate increase, although Fed speakers seem to be heading towards a June shift. Traders will closely monitor the Federal Reserve Minutes release on Wednesday.  Gold added $4.80 to trade at 1231.90 while silver gained 19 points to reach 17.313 staying dead center of its 2015 trading range between $17-17.50. Platinum soared adding $8.50 to reach 1216.20.

The US Dollar Index declined by 0.6 percent last week as weak U.S. retail sales and jobless claims data weighed on the currency. However, owing to the renewed concerns of Greece’s debt restructuring as talks got underway, ending the day nearly exactly where they began. The currency touched a weekly low of 93.68 and closed at 94.28 on Friday. This morning the greenback is trading at 94.07.

Gold traded lower for most of the last week with prices making a low of 1216.45 and high of 1245.80. Rise in the dollar offset the supportive impact of concerns over Greece’s future in the euro zone and fears over escalating violence in Ukraine, which hurt risk appetite. Expectations of an interest rate rise in the United States weighed on investor sentiment. The Fed should raise interest rates in June, a top Fed official said last Tuesday, saying the U.S. economy was strengthening and inflation would move back to the central bank’s target. Sweden’s Riksbank unexpectedly cut its key repo rate into negative territory and said it would soon buy bonds worth 10 billion Swedish crowns, catching investors off guard and prompting a flight to safety. Global shares rose as investors welcomed a ceasefire agreement between Russia and Ukraine easing safe haven demands for precious metals.

Last week base metals except copper traded on a negative note owing to concerns over Greece’s sustainability in the EU after caution over a deadlock in talks between Greece and its international creditors. Also, a slowdown in China, as indicated by a string of weak data from the biggest consumer acted as a negative factor. However, sharp losses were cushioned due to rising oil prices coupled with weakness in the greenback. Copper dipped this morning to trade at 2.598 after closing the week above the 2.60 level. The Chinese lunar holiday will begin this week and see traders leaving the markets for a week. Preholiday sales helped boost metals markets. Copper prices gained 0.8 percent last week as a weaker dollar helped extend a recovery from January’s five-year lows. However, physical consumption dimmed ahead of Chinese public holidays that start on Wednesday, but traders said they were reluctant to short copper in case of a surprise interest rate cut by PBOC, after China’s annual consumer inflation hit a five-year low in January, underscoring persistent economic weakness. China’s copper imports fell by 2.4 percent from a month earlier to 410,000 tonnes in January along with gain in LME stocks by 3.8 percent acted as negative factors.