METALS MORNING VIEW – Bullion continues to rise, gold & silver price climb

Jun 16, 2014 - 7:48 AM GMT

Precious metals were mixed on Friday, bullion held on to its recent found strength, while the PGMs continued to weaken in anticipation that the strikes in South Africa may end.  The gold price closed at $1,276.60, the silver price at $19.67, while platinum was off 1.6 percent at $1,423 and palladium extended lower to reach a price of $809.

Precious metals are stronger across the board with average gains of 0.8 percent with the PGMs up 1.2 percent, gold is up 0.4 percent at $1,282.10 and silver is up 0.6 percent at $19.78. Concerns over Iraq and the lack of a clear cut decision yet to end the strikes in South Africa are providing support.

Bullion in China is firmer with the silver price up 1.4 percent at Rmb 4,150/kg, whilst the gold price is up 0.7 percent at Rmb 257.05/g.

Equities – the Euro Stoxx 50 was little changed on Friday and the Dow closed up 0.3 percent and Asia has been mixed today with the Nikkei off 1.1 percent, the Hang Seng is little changed, while the Kospi is up 0.1 percent and the CSI 300 is up 0.5 percent.

Currencies – the dollar is weaker with the dollar index at 80.50, the euro is off its lows, last at 1.3550, cable is very strong at 1.7006, the aussie is firm at 0.9410, as are the yen at 101.76 and the yuan at 6.2131.

Data out today includes EU CPI, the Empire State Manufacturing index, US TIC long term purchases, industrial production, capacity utilisation and NAHB housing market index – see table below for more details.

For the precious metals we continue to like bullion and the pick-up in violence in Iraq is likely to provide support now. The PGMs are likely to remain choppy as the market adjusts to developments in South Africa, but overall we would expect dips to attract buying as the strikes will have tightened up the fundamentals considerably.


Metals Overnight Performance
BST 06:39 +/- +/- % Lots
Cu 6686 44 0.7% 3867
Al 1850.25 7 0.4% 210
Ni 18216 136 0.8% 321
Zn 2087.75 1.5 0.1% 415
Pb 2095 5 0.2% 220
Sn 22580 0 0.0%
Steel 450 0 0.0% Total
Average (BM ex-Steel) 0.4% 5,033
Gold 1282.1 5.5 0.4%
Silver 19.78 0.11 0.6%
Platinum 1440.2 17.2 1.2%
Palladium 818.4 9.4 1.2%
Average PM   0.8%


Economic Agenda
BST Country Data ACTUAL Expected Previous
12:01am UK BOE Quarterly Bulletin
12:01am UK Rightmove HPI m/m 0.1% 3.6%
6:00am Japan BOJ Monthly Report
 10:00am EU CPI y/y 0.5% 0.5%
 10:00am EU Core CPI y/y 0.7% 0.7%
1:30pm US Empire State Manufacturing Index 15.2 19
2:00pm US TIC Long-Term Purchases 41.3B 4.0B
2:15pm US Capacity Utilization Rate 78.9% 78.6%
2:15pm US Industrial Production m/m 0.6% -0.6%
3:00pm US NAHB Housing Market Index 47 45