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    JM Bullion Gold and Silver Market Update (9/15/16)

    Gold Spot Price Open: $1,324

    Gold Spot Price Close: $1,317

    Change in Gold Spot Price: -$7

    Silver Spot Price Open: $19.05

    Silver Spot Price Close: $18.99

    Change in Silver Spot Price: -$0.06

    Precious metals conceded some value today as some middle of the road US economic data was dealt. When all was said and done, gold ended up losing about 7 dollars while silver conceded a little more than 5 cents. Platinum and palladium finished the day mixed, but if we are being honest neither metal finished too far from where it began the day.

    US Economic Data Dealt

    Even though the pieces of economic data that were dealt today are not normally considered to be big market-movers, all this talk of potential interest rate hikes has changed that. Today, the US producer price data was dealt and did not show investors too much of anything. To be fair, expectations were for the PPI to increase by .1, so when we heard that producer prices remained flat from July to August, no one was entirely too surprised. Preventing prices from moving higher is the consistently stronger US Dollar as well as inexpensive crude oil prices. Despite all of this, inflation—which has missed the Fed’s 2% target time and time again—seemed to have worked its way slightly higher last month, and this is good news.
    Something that would help inflation gain more strength in a hurry would be growing wages, but even though the labor market is improving, wage growth is trudging along slowly, at best.

    In other US economic news on Thursday, weekly jobless claims figures were dealt. According to the US Department of Labor, first-time claims for unemployment benefits rose by 1,000 to bring the seasonally-adjusted average up to an even 260,000. Though the number of claims did rise, the ascent was much smaller than expected and this was good news. This is big news for no other reason than that seasonally-adjusted average number of claims has stayed below 300,000 for what is now 80 consecutive weeks. This is the longest stretch since the early 1970s; a point in time when the labor force was much smaller than it is today.

    Perhaps the biggest takeaway from today’s employment data is the fact that the 4-week moving average number of claims fell by 8,000. Though we say this every week, it is worth repeating; the 4-week moving average of claims is often viewed as the most accurate picture of the labor market. As such, today’s news was received with open arms by investors and market experts alike.

    US Equities Rise, Pressuring Metals

    Even though today’s US economic data was mostly weaker than expected—or at least not above expectations—equities in the United States were mostly on the rise. Further pushing equities higher is the fact that a rate hike announcement next week is becoming less and less likely. Now, even the most bold of estimates are putting the likelihood of a rate hike happening next week to 12%. Simply put, there are not very many people expecting to hear a policy change announcement this time next week.

    Wrap-Up

    All in all, Thursday was one of the most eventful days of the week. Apart from the producer prices and employment data that was dealt, we were also dealt retail sales and industrial production reports that more or less missed the mark. All told, these sub-par pieces of data each did their part to lower the chances that interest rates will be hiked this month. In fact, people already looking ahead to October will see that the chances for a rate hike are quite slim then too.

    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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