JM Bullion Gold and Silver Market Update (12/20/16)

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Gold Spot Price Open: $1,142

Gold Spot Price Close: $1,136

Change in Gold Spot Price: -$6

Silver Spot Price Open: $16.07

Silver Spot Price Close: $16.04

Change in Silver Spot Price: -$0.03

Despite showing some very small signs of strength to begin the week, precious metals are conceding value on Tuesday as outside markets prove to be quite bearish. When all was said and done, gold lost about 6 dollars while silver moved downward to the tune of about 3 cents. Platinum and palladium both finished the day on Tuesday down by about 5 dollars apiece.

European Violence Doesn’t Budge Gold, Silver

Despite Monday being a relatively quiet day as far as economic data is concerned, it was anything but that on the geopolitical front. In Berlin, Germany, a large cargo truck reportedly jumped up onto a busy sidewalk and ultimately barreled its way into a crowded marketplace. The end-result of this was that 12 people were killed (not including the perpetrator who was taken into custody) and nearly 50 more injured—some very seriously so. The authorities have not spoken with regard to the nature of the attack, however this has not stopped people from speculating that it is an act of terrorism that was, perhaps, inspired by ISIS. Of course, at this point in time those presumptions are far from confirmed.

Also on Monday, a Russian ambassador to Turkey was speaking at a photo gallery when he was shot and killed mid-speech. The attacker, a Turkish policeman, sparred everyone else and made it instantly clear that his motivation was tied to Russia’s influence in Syria, specifically Aleppo. Though Vladimir Putin has been quoted as saying that he will avenge the assassination of one of his foreign ministers, there is no clear indication as to what form this vengeance might take.

On a typical day, one would be led to believe that this upheaval of surprise violence across relatively stable regions of Europe would result in an increase in safe-haven demand for precious metals. Such did not come to fruition at all on Monday nor Tuesday, and it seems that, at least for now, the marketplace is overlooking the events. Going forward, however, we will be keeping a close eye on both situations and passing along information on any and all developments as they are made public.

USD Bounce Back, As Do Equities

The Bank of Japan on Tuesday announced that they were going to continue to pursue extremely loose monetary policy measures. As a result, the USD Index once again picked up steam and surged to a 14-year high. Janet Yellen also helped the greenback’s surge when, on Monday, she spoke positively with regard to the current employment situation in the United States. As we have been saying for a while now, anytime the Dollar advances it is going to be extremely difficult for precious metals to do anything other than lose value.

Not helping gold and silver even further is the fact that equity markets in the US and elsewhere continue to perform well. Ever since the announcement of Donald Trump’s election to the seat of President of the United States, equity markets have been hitting all-time highs and being able to retain those positions. That much is playing out again so far this week and is another factor that is continuing to pressure both gold and silver. It is difficult envisioning the rest of this week bringing much of a different story as trading activity will only continue to thin as the days wear on.

Wrap-Up

Gold and silver are continuing to fall thanks to many of the same factors that we have been talking about for well over a month now. As we look ahead to the rest of this week and into next, there are very few signs that anything is going to change in a hurry. With Donald Trump officially winning the Presidential election yesterday by the casting of Electoral College votes, equities are more than likely going to continue soaring near record highs.

All Market Updates are provided as a third party analysis and do not necessarily reflect the explicit views of JM Bullion Inc. and should not be construed as financial advice.