Gold and silver rose again in yesterday’s trading despite the drop in the other commodities such as oil and the depreciation of the Euro against the USD. Today there is the ECB rate decision which might have a substantial effect on the Forex markets. Today, Great Britain Manufacturing Production will be published, Great Britain’s rate decision will be made, ECB will announce the interest rate for January, the weekly update U.S. unemployment claims will come out and U.S retail sales monthly report will be published.
Gold moderately rose on Wednesday by 0.50% to $1,639.6; silver also rose by 0.25% to reach $29.89..During January, gold rose by 4.6% and silver by 7.08%.
ECB Rate Decision and Monetary Plan
In today’s press conference the President of the European Central Bank, Mario Draghi will announce ECB’s basic interest rate for January and perhaps even a quantitative easing plan (yes, just like in the U.S.), these decisions will be made while the EU debt crisis continues to threaten the EU. The recent publication by Eu Stat showing that the Euro Area inflation rate declined to an annual rate of 2.8% (annual terms) in December despite ECB’s decision from last month to cut the EU rate to 1.00%, may be among the factors to tilt the odds towards another rate reduction. If ECB will cut again interest rates it is likely to pressure down the Euros /USD and consequently might also affect gold and silver;
Forex / Gold & Silver– January
The Euro/USD changed direction and declined on Wednesday by 0.56% to reach 1.2706; furthermore, in yesterday’s trading the AUD also depreciated against the USD. Today’s ECB rate decision will probably affect the Euro especially if there will be a rate cut. In such a case it may also affect the AUD and consequently may also shift the direction of gold and silver.
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