Gold and silver did a lot of moving around this week, but at the end of the day they finished it not too far from where they started. While Thursday saw gold and silver jump forward right out of the gate, Friday saw quite the opposite and early morning losses almost completely cancelled out Thursday’s gains. There was a large amount of US economic data for investors to talk about and ponder over while Asia and Europe also made some headlines that caught the eyes of precious metals investors.
US Economic News
Tuesday, the unofficial start to the week because of the Memorial Day holiday on Monday, saw a decent portion of economic reports being released in the United States. Among Tuesday’s reports were the Housing Price Index, Manufacturing Index, and Consumer Confidence Index. All three of these reports were positive for the US economy but none more so than the Consumer Confidence Index which was at a 5-year high.
Thursday’s economic reports, including the 2nd quarter GDP report and the weekly jobless claims report, were weaker than expected, though not by any substantial amounts. Weekly jobless claims increased which was a bit disheartening, but on the whole the US economy seems to be doing just fine.
Since the Federal Reserve chairman addressed Congress last week about the future of Quantitative Easing in the United States, investors all over the world have been eyeing up US economic data with added scrutiny. It seems as though the next few weeks of economic data in the US will have substantial impact on whether QE is retained or wound down this summer.
Nikkei Index and Europe
The Japanese stock market has been performing extremely well ever since the nation’s central bank announced that it would employ aggressive monetary policy only a short while ago. This all changed this week as the Nikkei Index under performed heavily. On Thursday the Nikkei Index fell by over 5% and over the course of the past week losses came in around 15%. While Asian markets were performing better in the early parts of Friday, it seems like this week will mark one of net losses for the Japanese stock market.
Early in the week we reported increased unemployment in Germany which was confirmed later on during the week when eurozone unemployment came in at +12.2% in April. This number sets a record high for the region.
Germany, the EU’s leading economy, also reported a decline in retail sales for a third straight month. Despite all these negative news stories, European stocks did not have a terrible run of form this week.
The Week Ahead
There are not too many headlining news stories to look froward to for the first week of June, though investors will be paying close attention to every bit of data from the United States. Since the future of QE is up in the air at this point, investors are under the impression that the next 2 to 3 weeks of economic data, including the USD and stock market indexes, will have a major effect on whether QE is kept around or done away with.
Weekly Shift
Because the United States took the day off on Monday in order to celebrate the Memorial Day holiday, opening numbers will be from Tuesday.
Gold started the week at $1,395 and by the time all was said and done on Friday, it was at $1,390. This is a loss of 5 dollars. Silver started the week at $22.70 and when trading was done on Friday it was sitting at $22.28. This was a of 42 cents.