Gold Spot Price Open: $1,178
Gold Spot Price Close: $1,176
Change in Gold Spot Price: -$2
Silver Spot Price Open: $16.57
Silver Spot Price Close: $16.48
Change in Silver Spot Price: -$0.09
Even though OPEC’s decision to cut oil production may, on its face, have sounded like it would push spot values higher. When all was said and done on Thursday, gold conceded another 2 dollars while silver accumulated losses of about 9 cents. Platinum and palladium lost on the day too, with both metals losing more than 10 dollars apiece.
Higher Weekly Jobless Claims Fail to Move Metals
If the fact that gold and silver have not moved much higher in response to OPEC’s reported production cut deal surprised you, you will be even more shocked to find out that a higher weekly jobless claims tally was ignored by metals as well. Today, the Department of Labor announced that last week saw a 17,000 spike in the number of first-time claims for unemployment benefits. This brought the seasonally-adjusted average up to 268,000, which is the closest to the all-important 300,000 threshold we have been hanging under for 91 straight weeks now.
The data is so disappointing due to the simple fact that expectations called for a rise, but one that was much less significant than what we saw today. Most people were expecting a seasonally adjusted average of anywhere from 251,000 to 255,000. Instead, we saw a much higher rise. Perhaps the reason metals did not react much to today’s data has to do with the fact that almost everyone is expecting to see a rate hike announcement come the December FOMC meeting. Knowing full well that one poor week is not going to undo the last 90 upbeat weeks, investors were not overly concerned with today’s jobs data. If November’s non-farms job growth report comes back poor, we may have some cause for concern. But even then, a rate hike seems almost inevitable at this point.
Bearish Outside Market Continue to Weigh on Gold, Silver
Precious metals investors will not look back at November 2016 with any sort of fondness. This is mostly due to the fact that gold posted its biggest monthly decline in more than 3 years, while silver performed almost equally as poor. Between Donald Trump’s election and what that did to the Dollar, and the growing confidence that interest rates are going to be hiked this month, gold and silver had little to no room to move forward.
Daniel Smith, and economics analyst at Oxford, discussed the factors that hurt gold and what the future might hold when he was quoted as saying that “…gold has effectively gone into a downward spiral, triggered by the Trump election and the dollar strength that has come through from that. We see that dollar strength persisting over the next year, so there are a lot of reasons to think gold is going to struggle.”
Basically, it looks like the foreseeable future will be highlighted by a US Dollar dueling with precious metals. Unfortunately, there is more room to believe right now that the Dollar is going to be doing better, at least in the near-term, than precious metals.
Wrap-Up
All things considered, Thursday featured a day of action that is not too dissimilar to what we have grown accustomed to over the past month or more. There is currently very little across the global marketplace that is doing precious metals any favors and it seems as though that is going to continue to be the case going forward. As the holiday season intensifies there are some hopes that buying in the physical market will help keep spot values afloat, but we feel as though this will do more to limit losses than it will to contribute to any lasting gains.
