Gold Spot Price Open: $1,216
Gold Spot Price Close: $1,214
Change in Gold Spot Price: -$2
Silver Spot Price Open: $17.40
Silver Spot Price Close: $17.16
Change in Silver Spot Price: -$0.24
Precious metals held mostly steady to slightly lower for much of the day on Thursday as investors gear up for the all-important US employment report, set to be made public tomorrow. When all was said and done, gold lost about two dollars while silver was down by almost 25 cents. Platinum and palladium also finished lower, by about 15 dollars or so.
Market Anxiously Awaits US Employment Report
Thursday was a mostly quiet day of trading and saw a lot of investors simply hold their positions ahead of what is always touted as an important piece of economic data. The US Labor Department’s non-farm payrolls report is due out sometime tomorrow morning/afternoon and will be met with the same level of scrutiny it always is. At present, the market is expecting somewhere in the neighborhood of 215,000 to have been added to the US economy last month.
With that said, however, September played host to a good bit of lackluster economic data, and many fear that that will translate into a poor Labor Department report tomorrow. If the job addition figures do fall below the 215,000 threshold, there is a strong possibility that gold and silver will derive at least some sort of benefit. On the other side of the coin, if the figures handily beat expectations we may see precious metals be delivered yet another blow.
Euro, Equities Move Upward Today
The European Central Bank met for their monthly policy meeting today and, as expected, left their refinancing rate unchanged at .05%. ECB president Mario Draghi talked about his plans to have the central bank purchase private securities for at least two consecutive years in an effort to increase inflation as well as build up what is admittedly a very weak economy at present.
Though Draghi did speak on the asset-buying plans, he did not, according to the market, elaborate nearly enough to convince investors that deflationary pressures will be curbed anytime soon. As a result, the Euro currency took part in its biggest daily gain since last May. According to Peter Garnry, of Saxo Bank A/S, “Draghi did not bring out the big bazooka that the market had hoped for. Sentiment was already tilted to the downside on economic data and we are seeing an increasing likelihood of deflationary pressures. It seems that the market is interpreting Draghi’s words negatively and as not providing the salvation that was hoped for.” Though it is unlikely that the Euro will be able to retain today’s gains over the course of the coming days and weeks, it was encouraging to see the currency stop its now more than month-long downward slide.
There was also a bit of economic data published out of the EU today in the form of the Euro Zone producer price index, which fell by .1% in August from July. On an annualized basis, the EU’s PPI is down by almost 1.5%. This is yet another sign indicating that widespread deflationary pressures may be lurking just around the corner for the European economy.
Unfortunately for the USD, the Euro’s gains today ended up pushing the value of the greenback downward. This is perhaps part of the reason behind why gold and silver experienced only limited selling pressure today.
Wrap-Up
As we look ahead to tomorrow and the final day of the week, investors will be focusing almost solely on the US employment data that is scheduled to be made public. This data will likely influence the direction of equities, the USD, and precious metals. The attention of the market will also be placed on the unrest that is still going on in Hong Kong, though things have been more or less quiet for the last few days.
