Gold / Silver / Copper Prices - Weekly Outlook: July 30 - Aug. 3
Investing.com - The strengthening dollar looks likely to remain a significant headwind for gold this week, ahead of the Federal Reserve’s latest rate setting meeting, where it will probably lay the groundwork for its third rate hike this year in September.
Friday’s U.S. employment report for July will also be closely watched, amid expectations that its will point to a slight slowdown in hiring.
Metals traders will also be monitoring developments in the global trade conflict.
Gold prices settled lower for the day and for the week on Friday as the bearish trend in the yellow metal continued.
Expectations for higher rates tend to be bearish for gold, which struggles to compete with yield-bearing assets when rates rise, while a stronger U.S. currency makes gold and other dollar-denominated commodities more expensive for foreign investors.
Gold futures for August delivery settled down 0.29% at $1,222.20 on the Comex division of the New York Mercantile Exchange. For the week, prices ended down 0.56% and they have fallen 6.4% for the year so far.
The greenback dipped but held near one-week highs after data showing that the U.S. economy grew at the fastest rate in four years in the second quarter was offset by concerns that trade tensions would act as a drag on growth in the second half of the year.
The U.S. economy grew at an annual rate of 4.1% the Commerce Department reported, accelerating from 2.2% in the first three months of the year. Compared to the second quarter of 2017, the economy grew by a slower than anticipated 2.8%.
The data underlined expectations for the Fed to continue hiking rates this year, but economists are concerned that the surge in second quarter growth may not be sustainable.
Import duties could dampen consumer spending and discourage business investment.
The dollar eased from one-week highs against a currency basket following the report, with the U.S. dollar index, which measures the greenback’s strength against a basket of six major currencies, dipping 0.11% to 94.47 in late trade, paring its weekly gain to 0.24%.
Elsewhere in precious metals trading, silver settled up 0.13% at $15.515 a troy ounce, for a weekly loss of 0.35%.
Platinum settled at $832.30, 0.41% lower for the day, to end the week with a gain of 0.41%.
Among base metals, copper ended at $2.796, down 0.78% for the day, trimming its gains for the week to 1.53%.
Ahead of the coming week, Investing.com has compiled a list of significant events likely to affect the markets.
Monday, July 30
Germany is to release preliminary data on inflation.
The UK is to produce data on net lending.
Tuesday, July 31
China is to release data on manufacturing and service sector data.
New Zealand is to release data on business confidence, while Australia is to report on building approvals.
The BoJ is to announce its benchmark interest rate and publish what will be a closely watched rate statement. The announcement is to be followed by a press conference.
The euro zone is to release preliminary data on consumer price inflation.
Canada is to publish data on GDP and inflation.
The U.S. is to release data on personal spending and the Fed’s preferred inflation measure, the core PCE price index, along with data on business activity in the Chicago region and a report on consumer sentiment.
Wednesday, August 1
New Zealand is to publish its latest employment report.
The UK is to release data on manufacturing sector activity.
In the U.S., the ADP nonfarm payrolls report and the Institute for Supply Management’s manufacturing index will be released.
Later in the day, the Fed is to announce its latest monetary policy decision and publish its rate statement.
Thursday, August 2
Australia is to produce trade data.
The UK is to release data on construction sector activity.
The BoE is to announce its latest monetary policy decision and publish its latest inflation report. BoE Governor Mark Carney is to hold a press conference to discuss the report.
The U.S. is to release data on initial jobless claims.
Friday, August 3
Australia is to publish data on retail sales.
The UK is to release data on service sector activity.
Canada is to publish trade figures.
The U.S. is to round up the week with the nonfarm payrolls report for July and the ISM report on non-manufacturing activity.
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