WEEKLY BULLION REPORT-12 Jan To 17 Jan 2015

GOLD 

Gold ended a turbulent week at a 2014 high at 1223.30 gaining almost $15 after the US nonfarm payroll report was released. Gold prices rebounded from two days of losses after data showed continued job creation in the U.S., finishing 2.5% stronger on the week. The report was well above expectations, but a drop in the average wages worried investors, although with all the temporary hiring for the Christmas holidays and the new employment low wages can be expected as employers take one step at a time.  “Safe-haven demand appears to be rising again as oil prices slump and concerns grow about Greece exiting the euro. Physical demand in top consumer China had also been a factor. Gold halted two days of losses to head for the biggest weekly gain in a month, before the release of monthly data on U.S. employment that will provide direction on the outlook for borrowing costs in the world’s largest economy. The SPDR Gold Trust, the world’s largest goldbacked exchange-traded fund, is holding 704.83 tonnes as per latest available data on their website. 

SILVER 

Silver ended the week at 16.50 just above its resistance level, having been unable to break through all week long. Silver gained 120 points on Friday taking cues from gold which is also trading in the green for a change. Data showed continued job creation in the U.S., finishing 2.5% stronger on the week. The report was well above expectations, but a drop in the average wages worried investors, although with all the temporary hiring for the Christmas holidays and the new employment low wages can be expected as employers take one step at a time.   

COPPER 

Copper closed the week at 2.76 near its lowest point in several years. Relatively stable oil prices and more positive mood in equity markets have supported base metals prices. The only exception was copper. The red metal’s price extended previous declines and after Monday’s sharp decline hit a new 4-1/2 year low on Thursday. Less optimistic view of Chinese economy, improving fundamentals on the supply-side of the market as well as strengthening US dollar support our view that copper prices could fall this year, though current sharp price decline somehow surprised. Copper headed for the biggest weekly drop since November as China’s factory-gate prices extended a record run of declines, signaling weakening demand in the world’s largest metals user. Investors are weighing signs of slower growth in China and Europe and tumbling oil prices against strength in the U.S. China’s producer-price index in December fell 3.3 percent, the most in two years.

CRUDE OIL 

Crude Oil ended the week at 48.17 in the red for the day and the week as traders saw oil as low at 46 and though Thursday’s turnaround might be a sign of price stabilization. Brent Oil closed the week at just 50.08. In the last couple of days, crude price relatively stabilized and the frontmonth contract on Brent has mostly been trading slightly above 50 levels. Crude was probably supported by a sharp drop in US crude inventories and news about termination of a handful of crude production projects in the US may have underpinned the price as well. 

NATURAL GAS 

Natural Gas added 38 points but still remains well below seasonal costs. This time last year NG was setting record highs of $6 while this year it is closing the week at 2.965 one half the value. A major storm continues to cover most of the US and weather patterns show colder temperatures in the outlook but the lack of demand in November, December and early January are leaving storage numbers near record highs and have reduced the heating days of the season. Bloomberg reports that states east of the Rocky Mountains will see below-normal temperatures over the next five days, with the cold spell lingering from Texas to the Northeast through Jan. 18, said MDA Weather Services. U.S. gas inventories this week probably fell by more than the five-year average for the first time in seven weeks. 

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