Gold and Silver Edge Higher Ahead of ECB Decision

On Tuesday, gold (NYSEARCA:GLD) futures for June delivery, the most active contract, increased $4.70 to close at $1,472.10 per ounce, while silver (NYSEARCA:SLV) futures for July edged 2 cents higher to finish at $24.19.

Both precious metals managed to climb higher, despite consumer confidence taking a surprising upturn. The index of consumer attitudes rose to 68.1 in April, compared to an upwardly revised 61.9 in March, according to The Conference Board, an industry group. Analysts polled by Reuters expected the index to only reach 60.8 in April. Meanwhile, estimates in a Bloomberg survey ranged from 54.5 to 66.5.

Weak economic reports also indicate that the European Central Bank could be moving closer to another interest rate cut. Christopher Vecchio, currency analyst at DailyFx, explains, “Despite pleas from policymakers that growth would return to the euro zone ‘later in the year,’ there are very few signs to support that notion. More recently, we’ve seen unemployment rates in peripheral countries like Spain hit fresh record highs, while government estimates across the continent for deficit reduction and growth amid austerity conditions continue to erode. Today, we received another batch of soft European data that paints an even gloomier picture of the region: a deepening recession that will easily take the rest of 2013 to see some of its effects reversed.”

By the end of the day, the SPDR Gold Trust (NYSEARCA:GLD) gained 0.33 percent, while the iShares Silver Trust (NYSEARCA:SLV) dipped 0.34 percent. Gold miners (NYSEARCA:GDX) such as Yamana Gold (NYSE:AUY) and Barrick Gold (NYSE:ABX) both jumped more than 2 percent. First Majestic Silver (NYSE:AG) increased 1.9 percent.

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Disclosure: Long EXK, AG, HL, PHYS