Gold drifting higher after weakness
London (Aug 1) Precious metals prices dropped 1.1 percent on average yesterday as they extended their pull backs as the market searched for support levels that hold. We were expecting further long liquidation given the CFTC commitment of traders reports from last Friday and that is what we think the market is experiencing- that said, the dips continue to run into buying so we would not get too bearish overall.
This morning precious metals are drifting higher following yesterday’s weakness, they are up an average of 0.2 percent with the gold price unchanged at $1,282.60, silver up 0.2 percent at $20.36, palladium up 0.3 percent at $871.50 and platinum 0.4 percent firmer at $1,462.60.
PMI data out of China remains upbeat month-on-month, even if the latest numbers are slightly down from the flash numbers. China official and HSBC PMI readings both came in at 51.7 up from 51 and 50.7 respectively in June. Japan’s manufacturing PMI dipped to 50.5 from 50.8.
Bullion prices in Shanghai are weaker with gold off 0.7 percent at Rmb 257.40, but silver is only down 0.1 percent at Rmb 4,275, which suggests the lower prices may be attracting some industrial bargain hunting.