On Friday, gold (NYSEARCA:GLD) futures for April delivery declined $2.50 to settle at $1,725.90 per ounce, while silver (NYSEARCA:SLV) futures fell 15 cents to close at $33.22.  Despite new inflation and gold data, both precious metals were flat this week.

According to the Bureau of Labor Statistics, consumer prices in January increased 2.9 percent over the past 12 months.  Energy prices jumped 6.1 percent, while food rose 4.4 percent.  The Core CPI, which excludes energy and food, increased 2.3 percent year-over-year, representing the highest rate since September 2008.

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In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) edged .26 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) declined .80 percent.  Gold miners such as Yamana Gold (NYSE:AUY) and Goldcorp (NYSE:GG) both declined about .80 percent, while Newmont Mining (NYSE:NEM) fell more than 1 percent.  Silver miners (NYSEARCA:SIL) such as Coeur d’Alene Mines Corp. (NYSE:CDE) edged .30 percent lower, as First Majestic (NYSE:AG) and Silvercorp Metals Inc. (NYSE:SVM) fell 1.36 percent and .76 percent, respectively.

Although gold prices reached as high as $1,900 per ounce last year, demand remains strong among central banks.  The World Gold Council reports, “The net buying trend which started in Q2 2009 has proliferated, as emerging market central banks have continued to add gold on increasing concerns about the creditworthiness and low yields of their existing reserve assets.  Both the euro area sovereign crisis and the sovereign debt downgrade in the US during the summer of 2011 have compounded these worries.”  In the past two years, central banks have purchased more than 500 tonnes of gold.

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To contact the reporter on this story: Eric McWhinnie at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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