Gold Spot Price Open: $1,322
Gold Spot Price Close: $1,324
Change in Gold Spot Price: +$2
Silver Spot Price Open: $18.95
Silver Spot Price Close: $18.96
Change in Silver Spot Price: +$0.01
After falling a little to begin the week, precious metals ended up making some gains thanks to a slipping Dollar. When all was said and done, gold ended up picking up about 2 dollars while silver gained just about a penny or two. Platinum and palladium finished the day having made some gains, with platinum picking up close to 10 dollars while palladium gained close to 5 dollars.
Dollar Slips as Stocks Rebound
Barely a day after we were talking about the increasing chances of an interest rate hike being announced next week, we are now talking about the growing belief that rates will not be hiked. It seems as though this changes daily, and that is causing precious metals—amongst other assets—to change their trajectory constantly. Now that people are thinking that interest rates will remain put by this time next week, the US Dollar is under pressure, which is helping gold and silver inch forward.
Unfortunately, the USD’s weakness is not boosting metals too much due to the fact that US equities have bounced back after yesterday’s dismal performance. While Tuesday saw all 3 major US equity indexes losing value, Wednesday saw gains across the board. Despite this, the two-day performance of US equity indexes will end up being a net loss.
In the long-term, precious metals will directly be influenced by what happens to interest rates. The discussion regarding interest rate hikes will be directly influenced by US economic data which, in turn, means that the tone of economic data from the US will more than likely continue to dictate the movement of precious metals. Though we could hear of some sort of policy change by the end of next week, it is seeming more and more like thing will not be the case.
Skeptics Call BoJ Into Focus
The Dollar fell against most major currency rivals, but losses piled up against the Yen as investors and analysts are beginning to doubt whether the BoJ will choose to intensify its monetary stimulus program in the coming months.
As opposed to stimulating the Japanese economy by pumping it full of cash, the thought is that the BoJ will now move to introduce negative interest rates, and try to boost the economy via that route. Back in January, the BoJ introduced negative interest rates for the first time in a while, although this only provided a slight, temporary boost to the value of the Yen.
Regardless of what the BoJ actually decides to do with monetary policy, you can bet that any news regarding it will influence the global marketplace in some way. The Bank of Japan is having their monthly policy meeting towards the end of next week, and it will be interested to see what, if anything, the BoJ does to policy.
Wrap-Up
Gold and silver did gain today, but gains were kept to a minimum thanks to equities that bounced back from Tuesday. Apart from continued speculation with regard to what might happen to interest rates come this time next week, there is not all that much that investors are concerning themselves with. The BoJ will also be called into focus, and all this means is that next week is going to jam-packed with activity.
