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    JM Bullion Gold and Silver Market Update (7/19/16)

    Gold Spot Price Open: $1,331

    Gold Spot Price Close: $1,334

    Change in Gold Spot Price: +$3

    Silver Spot Price Open: $20.09

    Silver Spot Price Close: $19.88

    Change in Silver Spot Price: -$0.21

    Precious metals spent most of the day on Tuesday around even thanks to a general lack of fresh news for investors to react to. When all was said and done, gold managed to gain back a few dollars while silver trended downward by more than 20 cents. Platinum and palladium finished the day mixed, with platinum losing about 5 dollars while palladium managed to gain just over 10.

    IMF Comments on BRExit

    Since the United Kingdom decided that it no longer wishes to be a part of the European Union a little more than a month ago, there has been a lot of uncertainty abounding across the global marketplace. At first, we saw stock markets reeling due to the general unknown presented by a UK that was no longer part of the EU. We have since seen things calm down considerably from what they were a few weeks ago, but the fact of the matter is that so many investors still have no idea what kind of lasting impact the BRExit decision is going to have on the EU and global economies.

    Today, the IMF commented on the situation, however what the International Monetary Fund had to say does little to quell persisting concerns. In a statement today, the IMF announced that it was downgrading 2017 growth expectations; a decision that was directly influenced by the UK’s choice to depart the EU. Despite April projections of 3.4% global economic growth in 2017, the IMF now anticipated growth of just 3.1%. Maurice Obstfeld, the IMF’s chief economist, made a statement saying that this growth projection was going to edge higher than the previously recorded 3.4%, but a day after the IMF decided to raise growth expectations the UK decided to leave the European Union. In an incredibly short period of time, growth projections went from just shy of 4% to barely hovering over the 3% tally. For gold and silver, today’s downgrade is a positive because it does well to revive safe-haven demand, which has been lacking since the beginning stages of last week.

    Though precious metals have definitely stabilized since the immediate wake of BRExit, they are still also in control of the market and holding on to a lot of momentum. It will be interesting to see if this momentum is able to keep spot values afloat during the next few weeks, which are amongst the slowest of the year.

    Housing Data Mostly Ignored by Market

    According to data released early on Tuesday morning, housing starts in the month of June grew by more than 4.5%. This news is nothing to scoff at, but it is worth noting that June 2016 housing starts came in 2% weaker than what was recorded a year earlier. At the end of the day, no one ended up reading too heavily into the report and it did not have much of a lasting impact on the marketplace.

    To round out the day, US equities—along with most other major equity markets around the world—ended up performing rather poorly. This was likely nothing more than a small pullback after consistent gains over the past week, but it did well to reduce the pressure facing metals.

    Wrap-Up

    Gold and silver did not do much moving on Tuesday, which is mostly typical for a midweek day in the middle of July. As was mentioned yesterday, the pace of market activity is likely going to be significantly calmer over the next month and a half or so as is typical of the “dog days” of summer. Looking ahead, we have a lot of political activity beginning to take place in the United States as well as the upcoming monthly Fed meeting. It will be interesting to see if and how these events will affect the precious metals market.

    Disclaimer: 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.

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