When this first full week of August initially kicked off, it was quickly shaping up to be a fairly dismal week for precious metals. Thanks to some stronger economic reports from around the world, gold and silver came out of the gate this week posting some fairly heavy and consistent losses. Adding insult to injury, a member of the Federal Reserve made a statement that did not even come close to coinciding with what other Fed members have had to say over the course of the past few weeks.
Luckily, the last few days of the week were able to see gold and silver gain back the losses they made and then some. On the whole, this past 5 days was neutral for gold yet fairly positive for silver.
Positive Economic News
Over the course of the past year or so all we have heard as far as economic reports out of Europe are concerned is negative news story after negative news story. On top of the fact that there were very few positive news stories to latch on to, there were very few people attempting to rectify the collapsing European economy.
The first three days of this week brought with it three separate reports, all of which indicated that the European economy may have a positive outlook going forward. The firs report was the latest PMI reading, of which was the first reading over 50 in a while. As you may or may not be aware, a PMI reading above 50 suggests economic growth, while one under 50 points toward economic contraction.
The second and third positive economic reports came in the forms of an increased number of orders for manufactured goods from May to June as well as an increase in German industrial production. Despite these positive news stories, the European Central Bank forecasts that 2013 will end up being a year of slight contraction for Europe, though the prospects of a growing European economy in 2014 is looking more and more likely all the time.
These news stories, while good for the average European citizen, were adversarial to the price of gold and silver.
Weekly Move
Gold and silver fell dramatically over the first three days of the week, though the second half of the week saw them regain their losses.
Gold started the week at about $1,313 and by the time all things were settled gold was sitting at about $1,315.
Silver made a gain of over 70 cents as it started the week at $19.91 and ended at $20.62.