Gold Spot Price Open: $1,287
Gold Spot Price Close: $1,285
Change in Gold Spot Price: -$2
Silver Spot Price Open: $17.54
Silver Spot Price Close: $17.21
Change in Silver Spot Price: -$0.33
Precious metals were given a fresh boost on Thursday as a key piece of economic data proved to be weaker than anticipated, but by day’s end those nice gains were mostly lost. When all was said and done, gold gained more than 20 dollars before ending with a loss of 2 while silver advanced by almost 20 cents and ended up losing more than 30. Platinum and palladium gained on the day as well, with both metals having picked up a little more than 5 dollars.
Weekly Jobless Claims Rise by More Than 10K
Unexpectedly, it was announced on Thursday that last week’s first-time claims for unemployment benefits tallied 13,000 more than the prior week. This was well above expectations and brought the seasonally-adjusted average number of claims closer to the 280,000 mark. For those unaware, the closer the seasonally-adjusted average gets to 300,000, the more nervous the marketplace becomes. For gold and silver, however, this is but more good news as it drastically increases the safe-haven demand we have been witnessing for much of the past two trading weeks. In the weekly jobless claims’ immediate wake, both gold and silver spot values leapt forward by considerable margins.
The four-week moving average of jobless claims, which is often determined to be the most reliable view of the employment situation in the United States, was only down slightly, helped out by the stronger end of May we were a part of not too long ago.
Bank of England Holds Rates
The Bank of England held their monthly policy meeting on Thursday, and the result of that meeting was that there were absolutely no changes whatsoever made to monetary policy nor interest rates. The primary interest rate in the UK remains a record-low .5% and its asset-purchasing, quantitative easing program is still going strong at ~$530 billion spent per month.
In a prepared statement, the Bank of England said, “As the Committee set out last month, the most significant risks to the MPC’s forecast concern the referendum. A vote to leave the EU could materially alter the outlook for output and inflation, and therefore the appropriate setting of monetary policy.”
Basically, the Bank of England is saying that it is in their best interest to keep things as they are until we figure out what happens with this month’s referendum vote. For those unaware, the United Kingdom will be participating in a referendum vote nearer to the end of this month. The result of the vote will determine whether the UK remains part of the European Union or if it will leave the group. This is something that is important to the BOE, but is also very important for investors from all over the world. As it stands currently, most investors and experts alike will tell you that the betting money is being put on the UK voting to leave the EU, but the race is still tight and nothing is set in stone yet. Still, this belief is helping promote safe-haven demand across the world and that is pushing precious metals spot values upward.
Towards the end of the day, however, there were circulating rumors which held that the pending referndum vote might be postponed until later in the summer. These rumors were enough to bring precious metals down from their highs and finish the day having lost a bit of value.
Wrap-Up
For gold and silver, today was nothing more than an exceptionally great day playing in perfectly to what has been an exceptionally great two-week run. With so much to think about for investors, there is a strong feeling of uncertainty and that is translating into gains being made by precious metals. I anticipate that this will continue to be the case as we head into the final day of the week. Further, the next last few weeks of June are seeming more and more like they will be a frenzy of activity. Undoubtedly, the BRExit topic will be the prevailing news story until the referendum actually takes place.
