Gold prices declined in the early morning US trading period as inflation data out of Europe shows the central bank stimulus programmes are working, while US employment data beat expectations.
Gold for August delivery on the Comex division of the New York Mercantile Exchange fell $3.60 or 0.3 percent to $1,190.80 per ounce. Trade has ranged from $1,186.6 to $1,195.6.
Yesterday, the EU CPI flash estimate and the core CPI flash estimate were both positive at 0.3 percent and 0.9 percent respectively – inflation returned to the bloc for the first time in six months, suggesting the European Central Bank’s stimulus programme is starting to take hold, while the risk of deflation has subsided.
“If the higher inflation rate proves lasting, the ECB may not after all pump as much liquidity into the market as it had announced,” Commerzbank said. “Market participants will be keeping an eye on the ECB’s meeting today, though we do not expect it to send out any new signals to the markets.”
In US data, the April trade balance was – 40.9 billion, lower than forecasts of 43.9 billion, while ADP non-farm employment change in May rose 201,000, above estimates of 198,000 thousands.
“The job market posted a solid gain in May,” Mark Zandi, chief economist of Moody’s Analytics, said. “Employment growth remains near the average of the past couple of years. At the current pace of job growth, the economy will be back to full employment by this time next year.”
Late Tuesday afternoon, car sales data was released showing 17.79 million units sold, the highest monthly total since August 2005.
Greek Prime Minister Alexis Tsipras will reportedly meet with European Commission President Jean-Claude Juncker in Brussels on Wednesday evening. The country looks set to make a first repayment of 300 million euros to the IMF on June 5, though, it is unclear how it will pay off the rest of its debt.
In today’s eurozone data, retail sales month-over-month in April was up 0.7 percent, in-line with estimates, while unemployment rate in April stood at 11.1 percent, below predictions of 11.2 percent.
Additionally, final services PMI in May was 53.8, with consensus expecting 53.3.
The euro was 0.2 percent stronger at 1.1168 against the dollar, while Germany’s DAX and France’s CAC-40 were each up one percent.
Meanwhile in Asia, HSBC services PMI in may was 53.5, above forecasts of 53.3.
As for the other precious metals, Comex silver for July delivery was down 2.5 cents at $16.555 per ounce. Trade has ranged from $16.470 to $16.795.
Platinum futures for July delivery on the Nymex were down $3.70 at $1,109.10 per ounce, while the most-actively traded palladium contract was at $763.25, down $5.30.
(Editing by Tom Jennemann)
The post Gold declines on signs that the ECB could alter stimulus plans appeared first on The Bullion Desk.
No comments:
Post a Comment