As the Bank of Japan’s latest activities start having a less considerable impact on the Euro currency, analysts expect the BoJ to implement further economic stimuli through the expansion of the bond purchase program from 5 to 10 trillion yen. The bank may also widen the inflation target range.
The eurozone’s new manufacturing orders shrank more than expected.
Today the US is expected to publish its durable goods orders report. Numerous forecasts indicate growth. However, today’s major news from the US is the FOMC meeting minutes.
China’s Premier claims that the Chinese government has the right tools to stop the economic slowdown and is determined to act if necessary. He underlines that China will sustain its economic growth by all means.
In the meantime, Asian dealers keep reporting about lower investment interest in physical gold. The demand is currently driven by the US economic growth amid lower inflation. It appears that the near-term prospects of gold will be determined by the results of today’s FOMC meeting.
In the meantime, the IMF reports that numerous central banks around the globe keep accumulating their gold reserves. Last month the central banks of Turkey, Mexico, Russia, Ukraine and Kazakhstan were seen purchasing substantial amounts of physical gold.
According to GFMS, in 2011 the global demand for silver declined by 3.2% for the first time since 2007. The industrial demand for silver shrank by 2.7%.
Forecast:
According to the Commodity Trading Department of , on consolidating above 1644 gold may test 1650-1652, and maybe 1660. Alternatively, a failure to consolidate above 1644 may lead to a downswing hitting 1633-1630. A break below 1632 will give way to 1625, 1610, 1595.
At this point, silver still may test 31. In order to turn it into a level of support, the price will have to consolidate above 31.05. If this is the case, the next levels of resistance will be found at 31.25 and 31.50. On consolidating below 30.70, the downtrend may resume. The closest major levels of support will be located at 30.50, 30.0-29.90, 29.40.
