The prices gold and silver remained nearly unchanged for the fifth consecutive business day after they had increased precipitately during the first couple of weeks of September. The depreciation of the Euro along with other "risk currencies" may have curbed the rally of precious metals. The Philly Fed index slightly rose in September to reach -1.9 which is still negative. The U.S jobless claims remained high as they had decreased by only 3k to 382k for last week. These news items may have contributed to the modest fall in commodities prices. On today's agenda: Great Britain Net borrowing, Canada's Core CPI, and FOMC member Lockhart's Speech.
Despite the different directions gold and silver took in the past couple of days, the linear correlation of the two precious metal daily percent changes is still strong and positive, as indicated in the chart below. During September the linear correlation of their daily percent changes reached the highest level since May, which means the two metals' relation has tighten in recent months.
On Today's Agenda
Great Britain Net borrowing: this report will refer to the monthly changes in the public sector net borrowing for August; as of July, the net borrowing reached £0.6 billion;
Canada's Core CPI: This report will pertain to the core consumer price index for August 2012 and controlling the volatile components such as energy, fruit and vegetables. According to the Canadian CPI report for July 2012, the CPI rose by 1.3% during the past 12 month up to July – this is a slightly lower rate than in June. This report might affect the Canadian dollar, which is also strongly correlated with precious metals prices;
FOMC member Lockhart's Speech: He is expected to speak about the Fed's monetary policy and his projection for the U.S economy.
Disclaimer: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to trade foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts. Any opinions, news, research, analyses, prices, or other information contained on this website is provided as general market commentary and does not constitute investment advice. Forex Capital Markets LLC. will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.