Gold prices weaker in Asia as investors look ahead to the Fed

Gold prices weaker in Asia as investors look ahead to the Fed

Gold prices fell in Asia on Tuesday as investors looked ahead to a Federal Reserve meeting set to give further guidance on the timing of plans to taper its USD85 billion in monthly asset purchases. 

  
London-based market research group Markit reported earlier that its preliminary U.S. manufacturing purchasing managers’ index declined to a seasonally adjusted 54.4 in December from a final reading of 54.7 in November. The Federal Reserve Bank of New York reported earlier that its Empire State manufacturing index came in at 0.98 in December compared to November's -2.21 reading, though analysts were expecting the index to rise to 4.75. 
  
Separately, the Federal Reserve reported that U.S. industrial production advanced 1.1% in November after having edged up 0.1% in October, beating consensus forecasts for a 0.5% November reading. The data encouraged investors to sell the greenback for profits until the Fed makes its policy stance clear on Wednesday. Market talk said gold, which has taken a beating in recent sessions on expectations for the Fed to taper on Dec. 18, could rally if the U.S. central bank opts to hold off until early 2014. 

NYMEX crude oil flat in Asia with focus on Federal Reserve

Crude oil prices traded flat in Asia Tuesday with investors squarely focused on the Federal Reserve after spotty U.S. economic indicators rekindled expectations that the Federal Reserve could hold off on tapering its USD85 billion in monthly asset purchases at a policy meeting this week and wait until early next year.

ICE Futures Exchange Brent crude for January delivery, which expired at the end of the trading session, rose 1.5% to USD110.47 a barrel, posting its highest settlement since Dec. 6. The more actively traded February contract added 1% to USD109.41 a barrel.

London-based market research group Markit reported earlier that its preliminary U.S. manufacturing purchasing managers’ index declined to a seasonally adjusted 54.4 in December from a final reading of 54.7 in November.
Analysts were expecting the index to rise to 54.9 this month.

The Federal Reserve Bank of New York reported earlier that its Empire State manufacturing index came in at 0.98 in December compared to November's -2.21 reading, though analysts were expecting the index to rise to 4.75.

Natural gas falls as forecasts call for break in U.S. cold snap

Natural gas prices dropped on Monday after updated weather-forecasting models called for below-normal temperatures to give way to a thawing trend across a good portion of the eastern U.S.

Losses were somewhat limited over the possibility that a fresh blast of Arctic air could move in towards the end of December.

Cold weather will give way to seasonable and even above-normal temperatures across portions of the eastern half of the U.S. in the coming week, which sent natural gas prices falling.

Milder temperatures diminish the need for heating this time of year, thus decreasing demand for natural gas at the nation's thermal power generators.
The commodity came off earlier lows on expectations for a blast of below-normal temperatures to return by the last two weeks of the month, which should hike demand for heating in the country's homes and businesses.

Economic Calendar

Time	Cur.	Event	Actual	Forecast	Previous
Tuesday, December 17
15:00	GBP	Core CPI (YoY)		1.80%	1.70%
15:00	GBP	Core PPI Output (MoM)		0.10%	0.10%
15:00	GBP	Core PPI Output (YoY)		0.90%	0.90%
15:00	GBP	Core RPI (YoY)		2.70%	2.70%
15:00	GBP	Core RPI (MoM)		0.10%	0.00%
15:00	GBP	CPI (YoY)		2.20%	2.20%
15:00	GBP	CPI (MoM)		0.20%	0.10%
15:00	GBP	House Price Index (YoY)		4.20%	3.80%
15:00	GBP	PPI Input (MoM)		-0.50%	-0.60%
15:00	GBP	PPI Input (YoY)		-1.20%	-0.30%
15:00	GBP	PPI Output (YoY)		0.90%	0.80%
15:00	GBP	PPI Output (MoM)		-1.20%	-0.30%
15:00	GBP	RPI (YoY)		2.70%	2.60%
15:00	GBP	RPI (MoM)		0.10%	0.00%
15:30	EUR	Core CPI (YoY)		0.90%	0.80%
15:30	EUR	Core CPI (MoM)			0.00%
15:30	EUR	CPI (YoY)		0.90%	0.90%
15:30	EUR	CPI (MoM)		-0.10%	-0.10%
15:30	EUR	Labor Cost Index (YoY)			0.90%
15:30	EUR	ZEW Economic Sentiment		60.9	60.2
16:30	GBP	CBI Industrial Trends Orders		11	11
18:15	USD	Chain Store Sales (WoW)			-1.60%
18:15	USD	Chain Store Sales (YoY)			1.50%
19:00	USD	Core CPI (YoY)		1.70%	1.70%
19:00	USD	Core CPI (MoM)		0.10%	0.10%
19:00	USD	CPI (YoY)		1.30%	1.00%
19:00	USD	CPI (MoM)		0.10%	-0.10%
19:00	USD	Current Account		-100.0B	-98.9B
19:00	USD	Real Earnings (MoM)		0.30%	0.10%
19:25	USD	Redbook (MoM)			-1.50%
19:25	USD	Redbook (YoY)			2.60%
20:30	USD	NAHB Housing Market Index		55	54
21:00	GBP	BoE Gov Carney Speaks
22:00	USD	4-Week Bill Auction			0.03%
22:00	USD	Cleveland CPI (MoM)			0.10%
23:30	USD	2-Year Note Auction			0.30%
23:30	USD	5-Year Note Auction			1.34%