Gold Spot Price Open: $1,304
Gold Spot Price Close: $1,293
Change in Gold Spot Price: -$11
Silver Spot Price Open: $17.37
Silver Spot Price Close: $17.47
Change in Silver Spot Price: +$0.10
Precious metals finished mixed on Monday, but were mostly lower thanks to a strong risk-on attitude on the part of global investors. When all was said and done, gold lost close to 12 dollars while silver finished having gained close to 10 cents. Platinum and palladium, on the other hand, finished the day having gained about 15 dollars apiece.
BRExit Outlook Shifts Again
For the better part of the last few weeks, investors have slowly but surely begun paying attention to an upcoming referendum that will take place across the whole of the United Kingdom. This referendum will ask voters whether they would like to see the UK remain part of the European Union, or if they would like Britain to leave the EU and continue independently. Up until the beginning of this week, the overarching belief held by mostly everyone was that the UK and its citizens will opt to leave the EU. This news worked in gold and silver’s favor because the possibility of the UK leaving the EU is something that causes a lot of uneasiness for investors. No one is sure what will happen to the global economy if and when the UK departs the EU, and this uneasiness is translating into some nice underlying support for metals.
In looking at polls from this past weekend, there seems to be a shifting of opinion where now we are seeing more people expect Britain to remain an EU member. Officially, about 46% of those polled expect Britain to remain in the EU while just 42% thing that the country will leave. Even though the opinions of UK citizens have seemingly shifted a bit, it is clear to see that there is still no clear consensus about what the future holds for the UK.
For gold and silver, this slight change of opinion over the weekend ended up working against spot values. The referendum vote is scheduled to take place on Thursday, and it is widely believed that we will have a somewhat clear answer as to what the result of the referendum is by the end of the day Friday. Until then, you can bet that the global marketplace will continue speculating with regard to the possible consequences of the UK either leaving or remaining part of the EU.
Stocks, Oil Boast Improved Positions
Most major global stock indexes were on the up and up to begin this week mostly thanks to the altered outlook regarding the UK’s referendum. As was touched on a bit above, investors are going to find it difficult to focus on anything other than the vote taking place across the EU later this week.
Thanks to more people now under the impression that the UK will remain part of the EU, we are seeing global stocks as well as the price of crude oil tick upward. On one hand, oil moving upward is providing some additional support for metals, but the fact that stocks are performing better and there is more of a risk-on attitude today, any support created by oil’s appreciation will be undermined by the strong performance of equities.
Should the belief that the UK will remain an EU member continue to gain momentum, we may see spot values pushed even further downward, however that much remains to be seen.
Wrap-Up
As if it weren’t already completely obvious, there is but one thing on the mind’s of investors this week, and that is the UK referendum. Some US economic data is due for release, but being that interest rates are likely to remain put for the time being, it is going to take either extremely poor or extremely upbeat data for investors to offer up much of any reaction.
