Gold, Crude Oil, Nat Gas Up, Silver Flat, Copper Down
- Apr WTI Crude Oil closed +1.50 at 49.79 bbl
- Nat Gas finished up 0.04 2.73 MMBtu
- Apr Gold closed +3 at 1213.10 oz
- May Silver closed flat at 16.59 oz
- COMEX Copper -0.30 at 269.30 lb
The fall in Q-4 GDP, and disappointing manufacturing data from the Chicago region, drove Gold prices into the Green tis week, capping a 4-wk losing streak.
Next week may be positive for the Gold market as it has managed to hold above psych mark at 1,200 oz.
The recent data shows that the US economy started the year off slower than expected. There are risks that the economic data continues to disappoint and that will shift expectations of when the Federal Reserve will be able to raise interest rates.
Technical speaking, a clear break above 1,216 could lead to a test of 1,230.
Now that the geopolitical tensions are easing in Europe, and with Greece securing another 4 months of funding, the market will return its focus on the European Central Bank’s QE bond buying program launch in March.
The ECB meets next Thursday and although it will not be as dramatic as the January meeting when they announced its expanded asset-backed purchase-program, participants will want more clarification on when the bank will start making purchases, and how fast it will ramp up its balance sheet.
The data released next week will be scrutinized by economists and market participants to determine if it supports the Fed’s view that the economy is recovering and if it can handle a new rate hiking cycle.
The report that will have the biggest impact on Fed expectations will be Friday’s NFPs (nonfarm payrolls) report. So far economists are expecting to see another strong report, with consensus forecasts calling for the economy to add 241,000 jobs.
The market will also receive personal income and spending data for January.
Along with the ECB, the Bank of Canada will hold its monetary policy meeting next week. The last time the central bank met it cut rates by 0.25 bpts brining rates to 0.75%.
The biggest factor participants need to focus on the economic data to determine if the US economy is facing deflationary pressures.
Have a terrific weekend.
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