Gold Spot Price Open: $1,236
Gold Spot Price Close: $1,229
Change in Gold Spot Price: -$7
Silver Spot Price Open: $18.04
Silver Spot Price Close: $17.81
Change in Silver Spot Price: -$0.23
Precious metals got this week off to a rather lackluster start thanks to firmer stock indexes in the US and Europe. When all was said and done, gold lost around 7 dollars while silver fell by more than 20 cents. Platinum and palladium both lost on the day, but both fell by barely more than a dollar.
USD Index Hits 3-Week High on Tax Cut Expectations
The USD Index is at its highest levels since the end of January, and this is not allowing precious metals to have a very robust start to the week. For now, the greenback is moving higher on hopes that President Donald Trump will soon reveal a tax plan that is full of tax cuts. All throughout his campaign, and as recently as last week, Trump has commented with regard to tax cuts that are aimed at helping the beleaguered middle class.
The idea of tax cuts does well to calm an otherwise nervous marketplace. Now, investors are hoping that President Trump is turning his attention away from foreign affairs and focusing more on his domestic plans, specifically his fiscal policy.
As is the case with most of the promises made by President Trump, there is very little information with regard to what the new President’s tax plans will actually look like. The only thing we know is that individuals and businesses are reportedly going to be less burdened under Trump’s fiscal policy. A lot of folks are expecting a tax policy announcement this week, and that explains why both stocks and the USD Index started the week off strong.
Metals Down on Profit-Taking
Though the latter stages of last week were not very kind to precious metals, the fact of the matter is that both gold and silver posted weekly gains. Thanks to these gains, Monday saw a good bit of profit-taking on the part of investors who were looking to cash in on those gains. Not helping metals even more was the renewed risk-appetite on the part of investors. Though the precious metals bulls are said to still be in control through the short-term, today was a rather poor start to the week for spot values.
Traders Look Forward to Yellen Commentary
Fed Chair Janet Yellen is going to be delivering prepared remarks to House and Senate committees this week, and her words will be watched over closely. Yellen is set to comment not only on the state of the economy at present, she will also touch on what the future holds for the US economy and monetary policy.
As you could probably guess, investors are hoping to find out some more information with regard to when interest rate hikes might occur again. Though almost everyone is anticipating at least one or two more rate hikes this year, no one can agree on when those hikes might take place. Right now, there is about a 50% likelihood that we will see rates hiked again this upcoming June, according to polled investors. That is something that, over the long-term, will weigh on precious metals spot values.
Wrap-Up
Monday got the week off to a rather quiet start. There was not much in the way of fresh economic data to talk about, so we saw investors instead focus on what this week might bring about as far as President Trump is concerned. The President managed to mostly stay out of the headlines over the weekend, and if that continues through this week gold and silver may have a tough time benefitting from safe-haven demand, which has been quite strong in recent weeks. Naturally, we are also going to focus on Janet Yellen’s comments, however they will be mostly overlooked if she does not provide much insight with regard to what is going to happen to interest rates.
