On Tuesday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, fell $16.20 to close at $1,366.90 per ounce, while silver (NYSEARCA:SLV) futures for July decreased 8 cents to finish at $21.68.

Both precious metals declined as government inflation numbers continue to remain weak. The latest consumer price index report, released by the U.S. Bureau of Labor Statistics, showed an increase in the average price of goods and services of 0.1 percent in May, below expectations for an increase of 0.2 percent.

Much of the negative pressure recently has been in the food and energy components of the headline index. These components are generally volatile given the nature of the underlying markets, but even core measures, which strip out food and energy, have remained soft. Core CPI increased just 0.2 percent in May and 1.7 percent on the year.

By the end of the day, the SPDR Gold Trust (NYSEARCA:GLD) dropped 1.23 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell 1.04 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) both declined by more than 2 percent. Shares of Endeavour Silver (NYSE:EXK) fell 1.8 percent.

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Disclosure: Long EXK, AG, HL, PHYS

On Monday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, dipped $4.50 to close at $1,383.10 per ounce, while silver (NYSEARCA:SLV) futures for July decreased 20 cents to finish at $21.76.

Both precious metals experienced weakness, as investors received conflicting reports about the Federal Reserve’s next policy move. The central bank concludes its two-day meeting this Wednesday, which will be followed by a press conference by Chairman Ben Bernanke.

The Federal Reserve will also update its economic forecast. The outlook usually receives little attention from traders, but Jon Hilsenrath — considered to be a mouthpiece for the central bank — recently published an article for the WSJ saying any changes in the forecast will be a “critical issue.”

Hilsenrath explains: “But what they say about the economy will send important signals about what they expect to do in the future. If they maintain confidence in their economic forecasts, it could signal they think they’re on track to begin pulling back the program later this year.”

Although Hilsenrath wrote last week that the Federal Reserve was also likely to push back the “taper” talk at its policy meeting, an article from the Financial Times claims the central bank will signal a reduction in its bond-buying program.

Robin Harding explains, “Ben Bernanke is likely to signal that the US Federal Reserve is close to tapering down its $85bn-a-month in asset purchases when he holds a press conference on Wednesday, but balance that by saying subsequent moves depend on what happens to the economy.”

By the end of the trading day, the SPDR Gold Trust (NYSEARCA:GLD) closed 0.50 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) declined 1.10 percent. However, gold miners (NYSEARCA:GDX) such as Newmont Mining (NYSE:NEM) and Yamana Gold (NYSE:AUY) gained 0.75 percent and 0.40 percent, respectively. Shares of Silver Wheaton (NYSE:SLW) jumped 1.0 percent.

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Disclosure: Long EXK, AG, HL, PHYS

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On Friday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, increased $9.80 to close at $1,387.60 per ounce, while silver (NYSEARCA:SLV) futures for July jumped 37 cents to finish at $21.95.

Both precious metals received a lift today, as the U.S. Department of Labor reported that its seasonally adjusted producer price index gained 0.5 percent in May, easily beating estimates calling for a 0.1 percent increase. In comparison, wholesale prices fell 0.7 percent in April.

Furthermore, the Thomson Reuters/University of Michigan’s preliminary reading on consumer sentiment fell to 82.7 in June, compared to 84.5 in May. Unsurprisingly, survey director Richard Curtin notes that confidence declined the most among lower-income households, which were “more likely to report worsening overall financial prospects” than higher-income households.

In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) increased 0.40 percent, while iShares Silver Trust (NYSEARCA:SLV) jumped 1.30 percent. However, major gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) dropped more than 1.0 percent. Silver miners (NYSEARCA:SIL) also declined across the board.

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Disclosure: Long EXK, AG, HL, PHYS

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Over the course of only two days in April, gold plunged $200 to reach its lowest level since February 2011. In the process, gold posted its worst one-day percentage drop since 1980, and the largest fall in dollar terms on record. On a technical basis, gold reached its most oversold reading since at least 1975. The dismal performance was followed with a 5.4 percent loss in May. In fact, gold has now declined for seven of the past eight months.

Despite the recent price movement, some companies and countries see a bright future for gold. Deutsche Bank recently opened its second largest gold storage facility in the world in Singapore — a small Southeast Asian city-state. The facility is capable of holding up to 200 tonnes of gold in order to meet rising demand from wealthy investors that prefer having direct access to physical bullion.

Singapore is already one of the biggest financial hubs in the world, and removed a sales tax on gold last year to boost its share in the global gold market to 10-15 percent, compared to the current 2 percent. JPMorgan Chase – America’s largest bank by assets – also has a new facility in Singapore.

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As central banks around the globe continue to manipulate interest rates and markets, more investors are finding comfort in physical gold. Mark Smallwood, Deutsche Asset & Wealth Management’s head of wealth planning, tells WSJ, “Gold has traditionally been stored in London, Zurich, and New York, but there is a serious shift in dynamics going on as the global financial crisis continues to evolve.”

He also adds, “What we’re seeing is customers looking at gold and being cognizant of the fact that when things go wrong, where you’re storing the gold is extremely important. Risk factors for gold are increasing dramatically, and people want to store [it] where they perceive it to be safe, which often will involve geographically diversifying that storage.”

While exchange-traded gold products have seen an outflow for 17 consecutive weeks, demand for physical gold remains strong. In the first quarter of 2013, total gold demand reached 963 tonnes, representing a 13 percent drop from a year earlier, according to the latest report from the World Gold Council. Heavy selling pressure and outflows from exchange-traded funds accounted for the majority of this decline.

In contrast, total jewelry demand jumped 12 percent year-over-year to 551 tonnes in the first quarter, easily topping the five-year average of 500.5 tonnes. Meanwhile, total bar and coin demand increased 10 percent to 377.7 tonnes, compared to a five-year average of 281.3 tonnes.

Once again, China and India dominated jewelry demand by accounting for 62 percent of the global share. The Chinese New Year and India’s good spring harvest were cited as positive developments driving demand in the regions. The U.S. jewelry market posted its first year-over-year gain in more than seven years. Overall, global jewelry demand reached a record $28.9 billion in the first quarter.

Hope is never a good strategy, but there are still fundamental reasons for owning gold. Serious gold investors are not likely to be persuaded to sell their gold because of the recent correction. After climbing higher for more than a decade, a correction was overdue and needed to dampen speculation. A diversified portfolio can still benefit from holding gold.

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Disclosure: Long EXK, AG, HL, PHYS

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Both precious metals declined as stocks rebounded from a three-day losing streak. In fact, all three major indices rallied more than 1 percent. The Dow Jones Industrial Average jumped 181 points, while the S&P 500 gained nearly 24 points. The Nasdaq increased 45 points.

Stocks across the board received a late-afternoon lift as Jon Hilsenrath — considered to be a mouthpiece for the Federal Reserve — published an article for the WSJ saying the central bank is likely to push back expectations of a rate increase. He also reminded the market that any adjustment in the Fed’s monthly bond-buying programs will not automatically lead to a complete withdrawal.

While low interest rates are typically a positive for precious metals, the SPDR Gold Trust (NYSEARCA:GLD) closed 0.40 percent in the red, while iShares Silver Trust (NYSEARCA:SLV) managed a slight gain. However, gold miners (NYSEARCA:GDX) such as Newmont Mining (NYSE:NEM) and Yamana Gold (NYSE:AUY) both increased about 1 percent. Shares of Endeavour Silver (NYSE:EXK) jumped 1.7 percent.

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Disclosure: Long EXK, AG, HL, PHYS

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On Wednesday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, jumped $15.00 to close at $1,392 per ounce, while silver (NYSEARCA:SLV) futures for July increased 15 cents to finish at $21.80.

Both precious metals climbed higher as volatility returns to the stock market. The Dow Jones Industrial Average sank more than 100 points to post its first three-day losing streak of the year. The S&P 500 declined nearly 1 percent as all major sectors in the index traded in the red.

After trading above 84.0 last month, the U.S. dollar index also declined for the third-consecutive day to reach as low as 80.75 — its worst level in four months. Meanwhile, the Japanese yen continues to gain strength against the greenback.

By the end of the trading day, the SPDR Gold Trust (NYSEARCA:GLD) increased 0.75 percent, while the iShares Silver Trust (NYSEARCA:SLV) gained 0.53 percent. Gold miners (NYSEARCA:GDX) such as Newmont Mining (NYSE:NEM) and Yamana Gold (NYSE:AUY) jumped 1.6 percent and 2.9 percent, respectively. Shares of First Majestic Silver (NYSE:AG) increased 1.5 percent.

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Both precious metals traded lower as the Bank of Japan kept its current monetary policy unchanged, and upgraded its view of the economy. The central bank voted to keep expanding its money base at an annual rate of 60 trillion to 70 trillion yen.

Yoshiki Shinke, chief economist at Daiichi Life Research Institute, tells Bloomberg, “Apparently the BOJ considers a stock plunge is temporary, but the central bank would be forced to act if stock prices keep heading south,” At the same time, “if a central bank does everything investors call for, it would be pushed into a corner and forced to react endlessly.”

By the end of the trading day, the SPDR Gold Trust (NYSEARCA:GLD) declined 0.52 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell more than 1 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Newmont Mining (NYSE:NEM) both plunged more than 3 percent. Shares of First Majestic Silver (NYSE:AG) dropped 2.14 percent.

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On Monday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, edged $3.00 higher to close at $1,386 per ounce, while silver (NYSEARCA:SLV) futures for July gained 18 cents to finish at $21.93.

Both precious metals posted modest gains, despite Standard & Poor’s raising its outlook on the U.S. credit rating from “negative” to “stable.”

The credit rating agency says the chances of another U.S. downgrade is less than one in three. In a press release, S&P explains, “We believe that our current ‘AA+’ rating already factors in a lesser ability of U.S. elected officials to react swiftly and effectively to public finance pressures over the longer term in comparison with officials of some more highly rated sovereigns and we expect repeated divisive debates over raising the debt ceiling.”

By the end of the trading day, the SPDR Gold Trust (NYSEARCA:GLD) increased 0.50 percent, while the iShares Silver Trust (NYSEARCA:SLV) jumped 1.44 percent. Gold miners (NYSEARCA:GDX) such as Newmont Mining (NYSE:NEM) and Goldcorp (NYSE:GG) gained 0.41 percent and 0.32 percent, respectively. Shares of silver miners (NYSEARCA:SIL) across the sector edged slightly higher.

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On Friday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, dropped $32.80 to close at $1,383 per ounce, while silver (NYSEARCA:SLV) futures for July plunged 96 cents to finish at $21.74. It was gold’s first weekly lost in three weeks.

Both precious metals declined as the U.S. Department of Labor reported that the economy added 175,000 jobs in May, higher than the median forecast of 163,000 in a Bloomberg survey. However, the unemployment rate edged slightly higher to 7.6 percent.

The update on the employment situation has many believing that the Federal Reserve will modestly dial down its monthly bond-purchasing program. In fact, a former Fed Chairman is promoting the idea.

Speaking with CNBC, Alan Greenspan explains, “The sooner we come to grips with this excessive level of assets on the balance sheet of the Federal Reserve — that everybody agrees is excessive — the better. There is a general presumption that we can wait indefinitely and make judgements on when we’re going to move. I’m not sure the market will allow us to do that.”

In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) fell more than 2 percent, while the iShares Silver Trust (NYSEARCA:SLV) dropped 4.3 percent. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Yamana Gold (NYSE:AUY) both plunged more than 4 percent. Shares of Endeavour Silver (NYSE:EXK) sank 6 percent.

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On Thursday, gold (NYSEARCA:GLD) futures for August delivery, the most active contract, jumped $17.30 to close at $1,415.80 per ounce, while silver (NYSEARCA:SLV) futures for July increased 24 cents to finish at $22.71. It was gold’s highest settlement since May 14.

Both precious metals climbed higher as the U.S. dollar index, which compares the dollar in a basket against six other fiat currencies, dropped more than 1 percent. The Dow Jones Industrial Average and S&P 500 also spent most of the day in the red, but managed to squeeze out a gain by the closing bell.

China’s gold imports from Hong Kong totaled 126,135 kilograms in April, down from 223,519 kilograms in March. However, April’s total was still the second highest haul on record. Compared to last year, gold imports in April were almost 22 percent higher.

By the end of the day, shares of the SPDR Gold Trust (NYSEARCA:GLD) gained 0.75 percent, while the iShares Silver Trust (NYSEARCA:SLV) increased 0.70 percent. Gold miners (NYSEARCA:GDX) such as Yamana Gold (NYSE:AUY) and Newmont Mining (NYSE:NEM) gained 1.9 percent and 1.0 percent, respectively. Shares of First Majestic Silver (NYSE:AG) surged 2.5 percent higher.

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