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The US economy shrank for the first time since 2014 with 4.8% decline vs. 3.5% decline expected in Q1. The coronavirus outbreak has dragged on all aspects of the economy, ending the 11-year period of expansion which was the longest in US history.

Good morning, traders. Welcome to our Monday preview of the week ahead, focusing on the economic data and market narratives most likely to have an impact on gold and precious metals pricing, as well as the US Dollar and other key correlated assets.

Happy Friday, traders. Welcome to our weekly market wrap, focused on the news and economic data that means the most for the gold market as well as the Dollar and other correlated assets.

After rising 1.1% in February, durable goods orders plunged 14.4% in March according to the latest report from the US Commerce Department. The reading came in worse than expectations of 11.9% decline. The drop mars the worst fall since 2014, driven down by the impacts of the coronavirus outbreak and resulting oil price drop on the manufacturing sector.

The Markit manufacturing PMI dropped to 36.9 in April, down from 48.5 the month before and below expectations of 38. The services PMI sunk even further from 39.8 to 27, indicating greatly reduced activity in both sectors. Markit’s chief business economist Chris Williamson stated that April saw the coronavirus deal “a blow to the US economy of a ferocity not previously seen in recent history.”

An additional 4.27 million Americans filed for unemployment benefits in the week ended April 18, in line with the expectation of 4.5 million. This follows 5.23 million the week before, revised down from 5.24 million. The unemployment rate is now likely to approach 20% in the next two months.

The spread between the spot price of gold—that is, to buy/sell physical gold for immediate delivery—and the price of an active futures contract for gold—a paper trade guaranteeing physical gold at a later date—is typically fairly efficient. That is to say, the two prices are normally within a few Dollars. In late March of this year, as the Covid-19 pandemic crisis firmly wrapped itself around the global economy, that same spread (often referred to by traders as the EFP, or Exchange-for-Physical) blew out as the gold futures price rose an unreal $80 above spot. The market has been making efforts to moderate the drastic dislocation, but last week the gap was still $35/oz; even in this morning’s trading the EFP is roughly $15.

Good morning, traders. Welcome to our weekly preview of the market calendar, where we focus primary on the economic data and market narrative that could have the biggest impact on gold and silver prices, as well as the Dollar and precious metals’ other correlated assets.

Happy Friday, traders. Welcome to our weekly market wrap, with a focus on gold prices and the market narratives and economic data that had the biggest impact the yellow metal and will continue to do so next week.

The Philadelphia Federal Reserve manufacturing index has seen the lowest reading since July 1980, falling from -12.5 in March to -55.6 in April. Economists had forecast a reading of -37.5. The index measures business conditions in the region, highlighting the increasingly serious consequences of the coronavirus pandemic as it spreads through the US, now the global epicentre for the outbreak.

Construction of new homes in the US saw the largest monthly decline since 1984, pushed downward by the impact of the coronavirus outbreak on the housing market and the economy as a whole. Residential starts dropped 22.3% to a rate of 1.22 million vs. 1.3 million expected, an 8-month low. Permits dropped 6.8% to 1.35 million.

An additional 5.245 million Americans filed for unemployment benefits in the week ended April 11, slightly below the expected figure of 5.5 million. 22 million Americans have been laid off in the last month, with coronavirus containment procedures shutting down businesses nationwide in almost every sector.