Gold and silver began the second day of the first full week of August losing value, mostly thanks to better than expected economic reports from around the world. Now that we are in the midst of summer vacation time, the amount of trading that is going on on is small in comparison to other times of the year.
The slate of economic news stories to look out for this week is light, and because there are no major news stories the spot price of gold stands the chance of being moved by even the smallest bits of economic data.
European Economic Data
The first day of the week brought with it some exciting news out of the European Union in that the Purchasing Manager’s Index for July rose above the 50 threshold. Any PMI reading that clocks in above 50 is a good indication that the economy in question is experiencing growth rather than contraction.
More good news was in store for the European economy on Tuesday in the form of an increase in manufactured goods orders from May to June. Over the course of a month, manufactured goods orders increased by nearly 4%. This news did little to European stocks, though it is likely a major part of the reason why gold and silver took hits on Tuesday.
Even though the spot value of gold has been on the decline during the first two days of this week, the US Dollar Index has not seen the gains one might expect. The USD is actually hanging around a 5-month low and is even inching downwards even further.
Yesterday also saw some better than expected Chinese news be released as their PMI was also on the rise. Seeing as more and more economies are coming out of the doldrums, it is becoming increasingly difficult for gold to gain any sort of strong foothold, let alone surge forward in value. With spot values falling yet again, it is likely that we will see some sort of increase in demand for both gold and silver.