A heavy week of selling

GoldMoney weekly market report and customer metrics

Customer activity

It has been a heavy week for selling at GoldMoney, particularly out of the Loomis Swiss and UK vaults. Gold was struck the hardest, and silver followed suit, which can be attributed to speculation that an imminent US interest rate rise could pull down the price of precious metals.

Market events

On Wednesday, the European Central Bank president Mario Draghi announced that the Bank was ruling out a deposit rate cut, which indicated faith in the strength of the European economy. The US Dollar lost ground against the Euro as a result, which helped to boost gold above the psychological level of US$ 1,200.

In the US industrial output data showed that output was slower than expected, and China released figures that showed that its economy had grown by only seven per cent in the first quarter of 2015 – the slowest rate of growth in six years. These figures added to the downward pressure on the price of gold and silver.

At the same time, Greece admitted that without more bailout funding the prospect of defaulting on its debt could lead to a forced exit from the EU. This acted as a support for gold and helped bolster its price. Its price rebounded on Wednesday but the recovery was capped after European shares hit a 14-year high.

There was further disappointing data from the US new home-starts and jobless claims. Both were worse than expected. If there continues to be poor economic data, the Federal Open Market Committee – which is due to meet later this month – could re-evaluate whether there should be an interest rate hike. If they delay, it could be a boost for the gold price.

Gold rose above the US$1,200 mark – at the same time that oil jumped to US$63 a barrel on evidence that US oil production had peaked. As is typical, the gold price rise was driven by the oil price rise.

Looking ahead

The main focus remains on what the FOMC will decide to do at the end of April but there are some other significant releases coming up.

Tomorrow the US issues its consumer price index. And then next Wednesday, China releases its PMI-MFG index[1] which may provide further indication that the Chinese economy is slowing down.

Next week, we can expect the US will release data for Existing Home Sales, New Home Sales and publish its weekly Jobless Claims Figures which could see gold achieve a more stable position.

Week on week price performances

16/04/15 16:00. Gold up 0.1% to $1,196.96, Silver down 0.1% to $16.22, Platinum down 0.2% to $1,151.74 and Palladium up 1.2% to $770.05.

Ends

[1] PMI-MFG index: An indicator of the economic health of the manufacturing sector. The PMI index is based on five major indicators: new orders, inventory levels, production, supplier deliveries and the employment environment.

For further information or interviews please contact Gwyn Garfield-Bennett at Direct Input. Telephone 44 (0)1534 715411 or email gwyn@directinput.je

GoldMoney

GoldMoney is one of the world’s leading providers of physical gold, silver, platinum and palladium for private and corporate customers, allowing users to buy precious metals online. The easy to use website makes investing in gold and other precious metals accessible 24/7.

Through GoldMoney’s non-bank vault operators, physical precious metals can be stored worldwide, outside of the banking system in the UK, Switzerland, Hong Kong, Singapore and Canada. GoldMoney partners with Brink’s, Loomis International (formerly Via Mat, Malca-Amit, G4S and Rhenus Logistics. Storage fees are highly competitive and there is also the option of having metal delivered.

GoldMoney currently has over 20,000 customers worldwide and holds over $1billion of precious metals in its partner vaults.

GoldMoney is regulated by the Jersey Financial Services Commission and complies with Jersey's anti-money laundering laws and regulations. GoldMoney has established industry-leading governance policies and procedures to protect customers' assets with independent audit reporting every 3 months by two leading audit firms.

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