Gold and silver spot values are edging slightly higher in mid-afternoon trading Tuesday, fueled by short-covering and chart consolidation by investors. This week is not expected to emit a large quantity of economic data and will, as such, more than likely see silver and gold spot values trade sideways. Last week saw the European Central Bank hold their meeting and, as a result, introduce new monetary stimulus measures to combat rising deflationary pressures. Now, not even a week later, the European concerns have shifted from those relating to deflation to those relating to inflation.

It will be interesting to see if gold and silver will continue to feel pressure or if the world equity rally we are currently witnessing will finally cool down.

Italian Bond Yields On The Decline, Worries Linger

Like was stated earlier, this week is not expected to bring about any fresh fundamental inputs and will more than likely prevent gold and silver from making any significant gains. The only piece of data worth talking about this week is the weekly jobless claims report, expected to be released on Thursday.

In other news from Europe, it was reported today that Italian 10-year government bond yields have no fallen below the yields of similar US bonds. Because of the ECB’s newest monetary stimulus measures, which includes a negative deposit rate, it only makes sense that so many Italian bonds are being scooped up by investors and European banks. Today’s declining Italian bond yields may not be a major cause for concern just yet, it is hard to imagine that they are not an early indication of inflation.

Because of a surging US Dollar, the spot values of gold and silver are having a tough time making any gains. Luckily, crude oil prices are on the rise and are helping keep the spot values of gold and silver from declining to drastically. It will be interesting to see if metals can continue to build upon today’s gains or if surging US equity markets will continue to limit any forward progress being made by gold or silver.