Silver Market Morning

Gold Today –New York closed at $1,315 on Thursday and has held around that level through Friday and the opening of Asia and London on Monday. It then Fixed at $1,314.75 up $6.50. In the euro it Fixed at €984.831 up €3.70. Ahead of New York’s opening gold was trading at $1,316.40 and in the euro at €986.40.

Silver Today – Silver closed at $22.19 higher by 50 cents on Friday before trading in London at $21.93. Ahead of New York’s opening it traded at $21.87.

Gold _{(very short-term)}

The gold price is now consolidating around $1,300, today in New York.

Silver _{(very short-term)}

The silver price is now consolidating around $22, in New York today.

Price Drivers

Gold & Silver – The gold price bounced off support on Friday consolidating there. Remarkably, after the fall the sale of over 6 tonnes of gold on Friday, out of the SPDR gold ETF, did not cause further falls, but ensured the gold price remains in a consolidation phase above $1,300. We continue to expect the next month to see a volatile and very changeable market that may well confuse investors in precious metals.

Across the board of exchange rates, the dollar is weaker against most currencies by up to 2%. This is ahead of the Fed’s meeting tomorrow where the markets are now expecting to see an announcement that the Fed will not commence ‘tapering’. Either the Fed’s past statements have regained credibility [that they are not going to ‘taper’ soon] or the markets are now listening and believe the Fed’s will not ‘taper’ until next year. This is a turnaround and in the face of more evidence that the U.S. economy is gaining momentum. Even the housing market, with higher mortgage rates continues to rise adding to the optimism. We have always felt that the Fed should keep rates low even when growth gained traction until it could withstand higher interest rates [which we feel is not yet the case]. Tomorrow will see what’s what! [We cover that in our weekly newsletter - Subscribe to our newsletters at www.GoldForecaster.com and www.SilverForecaster.com]

Having said that, we persist in the opinion that the gold price is unrelated to the U.S. growth except positively.

The SPDR and Gold Trust gold ETF holdings saw sales of 6.01 tonnes on Friday, leaving the total of the SPDR gold ETF holdings is at 911.119 tonnes while the holding of the Gold Trust remains at 177.56 tonnes, together totalling 1,088.679 tonnes. The sale came as a surprise, because it is the first large sale we have seen in three weeks.

Silver – The silver price despite stronger fundamentals is following the gold price.

Regards,

Julian D.W. Phillips for the Gold & Silver Forecasters