Gold Fundamental Analysis April 17, 2012, Forecast

By FXEmpire.com

Analysis and Recommendations:

held pretty much even today, trading at 1650.15 which is a drop of 10.05 from the closing on Friday. The shiny metal dropped in electronic trading over the weekend and was just about at 1648. when markets opened today.

Gold declined for a second day, dropping with equities and other commodities, as renewed concern that Europe’s debt crisis is worsening boosted the dollar. Spot gold lost as much as 0.5 percent to a one-week low of $1,649.32 an ounce, and traded at $1,651.93 at 9:59 a.m. in Singapore. Bullion lost 1.1 percent on April 13 as the dollar rallied 0.8 percent against a six-currency basket after data showed China’s economy grew at the slowest pace in 11 quarters. The euro declined to a one-month low against the dollar today, while Asian stocks extended a global rout and copper tumbled as the cost of protecting Spain’s debt from nonpayment climbed to a record. China on April 14 announced a doubling of the yuan’s trading band, the first such move since 2007.

China widening the yuan’s trading band won’t have much effect as gold is denominated in U.S. dollars, and that’s what’s going to drive it in the near term. Gold lost as much as 0.6 percent to $1,650.20 an ounce on the Comex.

Spot gold of 99.99 percent purity slumped 1.3 percent to 336.51 yuan a gram ($1,660.74 an ounce) on the Shanghai Gold Exchange. European officials meet in Washington this week seeking a bigger war chest to combat the debt crisis.

Spain’s 10-year bond yield climbed 19 basis points last week to 5.98 percent, and the government plans to auction more debt this week. The yellow metal touched an intra-day low of $ 1640.64/oz and was trading at $ 1647.21/oz during European sessions.

Economic Reports for April 16, 2012 actual v. forecast

GBP	Rightmove House Price Index (MoM)	2.9%	1.6%
JPY	BoJ Governor Shirakawa Speaks
CHF	PPI (MoM)	0.3%	0.5%	0.8%
USD	Core Retail Sales (MoM)	0.8%	0.6%	0.9%
CAD	Foreign Securities Purchases	12.50B	7.23B	-4.28B
USD	Retail Sales (MoM)	0.8%	0.3%	1.0%
USD	NY Empire State Manufacturing Index	6.6	18.0	20.2
USD	TIC Net Long-Term Transactions	10.1B	41.3B	102.4B

Economic Events scheduled for April 17, 2012 that affect the European and American Markets

09:30 GBP CPI (YoY) 3.4%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.

10:00 EUR CPI (YoY) 2.6% 2.6%

The Consumer Price Index (CPI) measures the change in the price of goods and services from the perspective of the consumer. It is a key way to measure changes in purchasing trends and inflation.

10:00 EUR German ZEW Economic Sentiment 19.0 22.3

The German Zentrum f?r Europ?ische Wirtschaftsforschung (ZEW) Economic Sentiment Index gauges the six-month economic outlook. A level above zero indicates optimism; below indicates pessimism. The reading is compiled from a survey of about 350 German institutional investors and analysts.

10:00 EUR Core CPI (YoY) 1.5%

The Core Consumer Price Index (CPI) measures the change in the price of goods and services purchased by consumers, excluding food, energy, alcohol, and tobacco. The data has a relatively mild impact because overall CPI is the European Central Bank’s mandated inflation target.

13:30 USD Building Permits 0.71M 0.71M

Building Permits measures the change in the number of new building permits issued by the government. Building permits are a key indicator of demand in the housing market.

13:30 USD Housing Starts 0.70M 0.70M

Housing starts measures the change in the annualized number of new residential buildings that began construction during the reported month. It is a leading indicator of strength in the housing sector.

14:15 USD Industrial Production (MoM) 0.5%

Industrial Production measures the change in the total inflation-adjusted value of output produced by manufacturers, mines, and utilities.

Originally posted here