Gold Spot Price Open: $1,261
Gold Spot Price Close: $1,247
Change in Gold Spot Price: -$14
Silver Spot Price Open: $16.26
Silver Spot Price Close: $16.32
Change in Silver Spot Price: +$0.06
Gold and silver finished the day mixed, but were mostly lower thanks to a rebound on the part of global stocks as well as a more noticeable risk-appetite across the global marketplace. When all was said and done, gold lost a little more than ten dollars while silver actually managed to add a little more than five cents. Platinum and palladium both finished the day lower, but neither metal lost more than ten dollars.
Risk-On Day Hurts Precious Metals
After a few days of gains to start the week, both gold and silver moved downward on Wednesday thanks mostly to a pullback after recent gains. Not only that, but there was a stronger risk-appetite as both global equity markets and the US Dollar rebounded. Part of the reason behind the stronger risk-on attitude is the fact that China, for the first time in quite some time, played host to upbeat economic data.
For the first time in 9 months, China saw exports improve by more than 11% in March. Imports for the same month were down, but they fell by much smaller margins than were originally anticipated. China has been home to wholly negative data across the board recently, so any bit of upbeat news is sure to get investors excited.
For the Euro Zone, however, the news was not so bright as industrial output for the month of March was down by nearly 1%. Considering expectations were for a drop of only half a percentage point, today’s data was perceived as being quite negative in nature. All in all, most recent data from the European Union has been downbeat and indicative of the wider trend we have seen from Europe recently. Despite their best efforts, it seems as though the European Central Bank is unable to pull the region’s economy from a rut that is continuing to persist; for more than a year now.
More Interest Rate Talk
As has been the case for quite some time now, we cannot go more than one week without hearing some discussion from members of the Fed with regard to when they think further interest rate hikes should come. Richmond Fed President Jeffrey Lacker was the latest to speak, and in his remarks he alluded that rates should be hiked about 4 times this year yet.
Commenting at the UNC Wilmington, Lacker made it clear that he still supports the Feds original plan that was laid forth in December. He said, “My sense is that the less leisurely but still gradual pace of target rate increases that FOMC participants submitted at year-end is still more likely to be appropriate. Given the extent to which global risks to the U.S. have subsided, prudence suggests staying the course with a gradual sequence of rate increases.”
Lacker, unlike other members of the Fed, feels as though outside forces should not be taken into as much consideration when it comes to determining if and when to raise rates. Perhaps the kicker in all of this is that it really doesn’t matter what Lacker has to say as he is not a voting member of the FOMC and will have no input on whether or not rates are actually raised this month, next month, or at any other point in the year.
Wrap-Up
Gold and silver pulled back a bit today in the face of stronger outside markets, but the fact of the matter is that they are still sitting in a good position at this midweek juncture. Upbeat data from China today is likely going to encourage investors that not all hope is lost for the large Asian economy, but it is going to take much more than a single day’s worth of data to change the still largely negative outlook on Chinese economic growth for the year.
