The price of gold slightly lower this morning after settling yesterday at a two-year high. There’s a lot of market data to be absorbed later this week that could have an impact on the price of gold.
First off is Thursday’s Bank of England’s meeting. The BoE is expected to cut interest rates for the first time in seven years. The reason is the disappointing UK economic data of late, following the U.K.’s vote to leave the EU. The market is expecting the BoE’s Monetary Policy Committee to deliver a message that easing is necessary to counter the economic hit experienced after the Brexit-vote. The last time the BoE had a rate change was March 2009, when the decision was made to lower the rate to 0.5 percent during the worldwide financial crisis.
ADP jobs report released this morning shows an increase of 179,000. The National Employment report is a measure of non-farm private sector employment figures. This report had no effect on the price of gold this morning.
The market also awaits Friday’s U.S. employment figures. Many market participants question the accuracy of these numbers as seen in May only 38,000 jobs were created then in June 272,000. What caused the big difference month to month? The instant the May job number was released, reported way below the streets expectations, we saw gold rally $26 dollars in a blink of an eye. So many professional gold traders will just wait till the numbers are released on Friday before taking a position again.
Author Name: Walter Pehowich
This editorial has been prepared by Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not prove to be true, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept the foregoing.