Gold / Silver / Copper futures - weekly outlook: Nov. 30 - Dec.

November 29, 2015

New York (Nov 29)  Gold prices ended the week at the lowest level since February 2010 on Friday, as market players braced for a hike in interest rates by the Federal Reserve next month.

Gold for February delivery on the Comex division of the New York Mercantile Exchange dipped $13.50, or 1.26%, on Friday to close the week at $1,056.20 a troy ounce.

It earlier fell to $1,051.60, a level not seen in almost six years, as investors cut holdings of the precious metal amid expectations the Fed will raise rates for the first time in nearly a decade at its mid-December meeting.

For the week, prices of the precious metal fell $13.80, or 1.88%, the sixth straight weekly loss.

Trading volumes were thin on Friday due to the Thanksgiving holiday in the United States. The U.S. stock market closed at 1:00PM Friday after being closed Thursday for Thanksgiving.

The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, ended Friday's session up 0.19% at 100.05. It earlier rose to 100.26, a level not seen since March 16.

The greenback remained broadly supported after a string of upbeat U.S. data released over the week added to expectations that the Federal Reserve will raise interest rates next month.

Dollar-priced commodities become more expensive to investors holding other currencies when the greenback gains.

Gold futures are down more than 6% so far in November amid expectations the U.S. central bank will raise interest rates for the first time in nine years when it meets December 15-16.

Expectations of higher borrowing rates going forward is considered bearish for gold, as the precious metal struggles to compete with yield-bearing assets when rates are on the rise.

Also on the Comex, silver futures for March delivery shed 12.7 cents, or 0.9%, on Friday to settle at $14.04 a troy ounce by close of trade. Prices slumped to a six-year low of $13.85 on November 23.

On the week, silver futures declined 8.8 cents, or 0.62%, the sixth consecutive weekly decline.

Elsewhere in metals trading, copper for March delivery inched up 0.8 cents, or 0.41%, on Friday to settle the week at $2.057 a pound. The red metal surged by as much as 4% on Thursday, as China regulators were said to consider a probe into metal short-selling in the local market.

Despite Friday's gains, copper prices lost 0.2 cents, or 0.19%, on the week, as the possibility of higher borrowing costs in the U.S., a broadly stronger U.S. dollar and slower global economic growth, especially in China, weighed.

In the week ahead, investors will be focusing on Friday’s U.S. nonfarm payrolls report for November, the last jobs report before the Federal Reserve decides on interest rates at its December 15-16 meeting.

The outcome of Thursday’s European Central Bank meeting will also be in focus amid speculation the central bank could ramp up its monetary stimulus program.

Ahead of the coming week, has compiled a list of these and other significant events likely to affect the markets.

Monday, November 30

The U.S. is to publish a report on manufacturing activity in the Chicago region as well as private sector data on pending home sales.

Tuesday, December 1

China is to release reports on manufacturing and service sector activity from the China Federation of Logistics and Purchasing, as well as the Caixin services index and the revised reading of the Caixin manufacturing index.

The Reserve Bank of Australia is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.

Bank of England Governor Mark Carney is due to hold a press conference about the Financial Stability Report and U.K. Bank Stress Test results, in London. The U.K. is to produce a report a manufacturing activity.

In the U.S., the Institute of Supply Management is to release data on manufacturing activity.

Wednesday, December 2

RBA Governor Glenn Stevens is due to speak at the Australia-Israel Chamber of Commerce breakfast, in Perth. Australia is to publish data on third quarter gross domestic product.

The euro zone is to publish preliminary data on consumer price inflation.

The U.S. is to publish the ADP report on private sector jobs creation as well as weekly data on crude oil stockpiles. Fed Chair Janet Yellen is due to speak about the U.S. economic outlook at The Economic Club of Washington D.C.

The Bank of Canada is to announce its benchmark interest rate and publish its rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.

Thursday, December 3

The ECB is to announce its monetary policy decision. The rate announcement will be followed by a post-policy meeting press conference with President Mario Draghi.

The U.S. is to release data on initial jobless claims and factory orders, while the ISM is to publish data on service sector activity in the U.S. Fed Chair Yellen is due to testify about monetary policy before the Joint Economic Committee, in Washington D.C.

Friday, December 4

The U.S. is to round up the week with the closely watched report on nonfarm payrolls.


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