Gold / Silver futures – weekly outlook: October 3 – 7

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Gold prices erased early gains to end lower on Friday as concerns over the prospect of a U.S. rate hike before the year’s end overshadowed concerns over the health of Deutsche Bank (DE:DBKGn).
Gold for December delivery on the Comex division of the New York Mercantile Exchange fell $7.25, or 0.55%, to settle at $1,313.8 a troy ounce.
Prices rose as high as $1,327.7 earlier in the session.
Safe haven demand for gold waned as Deutsche Bank shares rebounded Friday following reports that it is nearing a deal to settle a mortgage-securities investigation by paying a $5.4 billion fine, well below the Justice Department’s original proposal of $14 billion.
Gold prices typically rise during times of political or economic uncertainty, amid expectations that bullion will hold its value better than other assets.
For the week, the precious metal ended down 1.79% as markets continued to speculate over the timing of the next Fed rate hike.
In the week ahead, traders will be focusing their attention on Friday’s nonfarm payrolls report, seen by many as the clearest sign on the health of the labor market, amid ongoing speculation over whether U.S. interest rates will rise this year.
The Fed raised rates for the first time in almost a decade in December and forecast rates would rise four times this year, but officials have recently acknowledged that the mixed economic recovery means rates are likely to remain lower for longer.
The Fed’s next meeting is in November, but a rate hike ahead of the presidential election is seen as unlikely.
Investors currently price a 55.7% chance of a rate hike at the Fed’s December meeting; according to federal funds futures tracked’s Fed Rate Monitor Tool.
Gold is sensitive to moves in U.S. rates, which lift the opportunity cost of holding non-yielding assets such as bullion, while boosting the dollar in which it is priced.
Also on the Comex, silver futures for December delivery were at $19.22 a troy ounce in late trade.

Monday, October 3

Japan is to publish the Tankan surveys of manufacturing and service sector activity.
Financial markets in Shanghai will be closed for a national holiday.
German financial markets will also remain closed for a holiday.
The U.K. is to release data on manufacturing activity.
In the U.S., the Institute of Supply Management is to report on manufacturing activity.

Tuesday, October 4

Financial markets in Shanghai are to remain closed for a national holiday.
The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.
Australia is also to publish data on building permits.
The U.K. is to release data on construction activity.

Wednesday, October 5

Financial markets in Shanghai will be closed for a national holiday.
Australia is to release figures on retail sales.
The U.K. is to produce data on service sector activity.
The U.S. is to release the ADP report on private sector job creation, the ISM report on service sector activity and data on factory orders.
Both the U.S. and Canada are to release trade data.

Thursday, October 6

Shanghai’s financial market will remain closed for a holiday.
Australia is to release trade data.
The European Central Bank is to publish the minutes of its most recent policy meeting and German is to report on factory orders.
The U.S. is to publish the weekly report on initial jobless claims.

Friday, October 7

Financial markets in Shanghai will be closed for a national holiday.
The Swiss National Bank is to publish data on its foreign currency reserves.
The U.K. is to release industry data on house price inflation and official figures on industrial production.
Canada is to produce its monthly employment report.
The U.S. is to round up the week with the closely watched report on nonfarm payrolls.

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