Gold weekly recap, November 18 – November 22
New York (Nov 24) Gold fell on Friday and capped the biggest weekly decline in more than two months after protocols from FOMC’s October meeting showed earlier in the week that policy makers felt overall comfortable with trimming Fed’s monthly bond purchases in the upcoming months, provided it warranted sustainable economic growth. Strong U.S. economic data also fueled speculations for an earlier-than-expected taper, offsetting previous comments by Fed Chairman Ben Bernanke and his probable successor Janet Yellen, who called for sustained accommodative monetary policy in the near future. Silver, platinum and palladium tracked gold’s downward momentum.
On the Comex division of the New York Mercantile Exchange, gold futures for settlement in December were mostly unchanged on Friday and settled at $1 243.00 per troy ounce after swinging between day’s high and low of $1 248.20 and $1 240.50 an ounce. The precious metal plunged to a 4-1/2-month low of $1 235.90 an ounce on Thursday and settled the week 3.6% lower, the weakest weekly performance in more than two months.
Gold plunged after minutes of FOMC’s October meeting revealed on Wednesday the Federal Reserve might begin trimming its quantitative easingMonetary policy used by central banks to stimulate an economy when conventional policies have become ineffective. The central bank is increasing the monetary base by purchasing long-term financial assets from commercial banks and other private institutions. program “in the coming months”, if the economic recovery moves in the desired direction. Fed minutes showed that policy makers “generally expected that the data would prove consistent with the committee’s outlook for ongoing improvement in labor market conditions and would thus warrant trimming the pace of purchases in coming months.”
The precious metal was further pressured after the Commerce Department reported that U.S. retail salesTracks the changes in retail sales' volumes. Information is gathered through a research including big retailers and an excerpt for the smaller ones. Higher volumes mean higher consumer demand, increased production and economic growth. Calculated both on a monthly and annual basis. jumped by the most since July last month, indicating the 16-day government shutdown had minimal-to-no effect on the economy. Retail salesTracks the changes in retail sales' volumes. Information is gathered through a research including big retailers and an excerpt for the smaller ones. Higher volumes mean higher consumer demand, increased production and economic growth. Calculated both on a monthly and annual basis. rose by 0.4% in October, exceeding the median estimate of 86 analysts surveyed by Bloomberg for a minor 0.1% advance. September’s reading received an upward revision to 0.0% from initially estimated at -0.1%.
(Courtesy of Binary Tribune)
