Morning Market Update: Feb 7

February 7th, 2013 by

Gold and silver were trading in a narrow range this morning until European Central Bank chairman Mario Draghi held an upbeat press conference after the ECB’s meeting. Draghi said that he believed the Eurozone economy was past the worst, and would improve in the second half of the year. This statement, combined with a dropping euro boosted the dollar, dealt a hammer blow to gold and silver. The two metals resumed narrow, choppy trading at their new levels for a bit before reviving higher.

The ECB meeting wasn’t the only happy news out of Europe this morning. German industrial production increased 0.3% in December, lending support to Draghi’s estimate of European recovery this year.

China is set to release a raft of economic data tomorrow, before everyone takes a week-long vacation for the Lunar New Year. While physical gold purchases in Japan have picked up in the face of the government’s announced plan to devalue the yen, this will not be enough to replace the usual physical buying from China next week.

In the U.S., first-time jobless claims dropped a mere 5000 to 366,000, against analysts’ expectations of 360,000. With last week’s figures being revised upwards by 3000, the ranks of the newly-jobless joining the unemployed each week is basically steady. Worker productivity was down, signifying that businesses may have wrung the last bit of efficiency out of current workers. U.S. stocks opened down on the news.

 

by David Peterson