Precious metals prices turned lower on Thursday, as the price to invest in Gold dipped to $1,635.00 an ounce, and the price to invest in Silver eased to $30.30 an ounce, after the Labor Department reported that Americans filing initial claims for state unemployment benefits dropped to a seasonally adjusted 341,000 claims last week, well below the 360.000 claims economists had expected. "This is consistent with the good news coming out of the employment market, signs that things are getting better," said Peter Cardillo, of Rockwell Global Capital.
UBS trimmed its one month Gold forecast on Thursday, but decided to keep its three month forecast of $1,850 an ounce, in place. “One of the key risks to a bullish Gold view right now is the pick-up in global economic growth, which takes the shine off defensive assets like Gold,” said UBS. “We continue to see upside for Gold this year, and the outlook remains fundamentally bullish given that the monetary policy backdrop remains supportive for now,” the bank said. Silver will most likely take its cues from Gold, continued UBS.
Marcus Grubb, of the World Gold Council (WGC) looks for investment in Gold to continue at a steady pace saying, “there are still many tail risks out there in the U.S.,” including the uncertainty surrounding the sequestered spending cuts and the debt ceiling. “We look at the macroeconomic picture and the policy picture for 2013 and think even if is a bit more positive for equities…it’s still positive for Gold,” says Grubb. “You still are seeing enormous quantitative easing, zero interest rates, and now given Japan is joining that type of economic policy…we see that as a bullish scenario for investment demand for Gold.”
Meanwhile Gold is even likely to benefit from the ongoing “currency war,” says HSBC. “Historically, assets that are regarded as safe havens include the JPY, the CHF, the USD and Gold,” says the precious-metals team from HSBC. “Bullion, being the currency that you cannot print, may benefit should the currency war escalate, in our view.”
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I intend to portray my thoughts and ideas on the subject which may s be used as a tool for the reader.
I do not accept responsibility for being incorrect in my speculations on market trend.
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