Gold Spot Price Open: $1,122
Gold Spot Price Close: $1,132
Change in Gold Spot Price: +$10
Silver Spot Price Open: $15.00
Silver Spot Price Close: $15.37
Change in Silver Spot Price: +$0.37
Precious metals moved upward on Thursday after the Federal Reserve of the United States decided on holding interest rates at current levels. When all was said and done, gold gained about ten dollars while silver managed to add roughly 37 cents. Platinum and palladium lost value today as well, with palladium finishing down by roughly 15 cents.
European Stocks Move Higher Again
For a second consecutive day, European equities moved forward on bets that the Federal Reserve of the United States will not move to raise interest rates. The Swiss National Bank also had a policy meeting today, but they moved to keep their interest rates in the negative realm. In addition, the SNB announced that they would remain active in the foreign currency market even though the Swiss Franc has been depreciating. Thanks to oil prices that are once again on the decline, negative inflation in Switzerland is likely to be even more drastic than what the SNB predicted all the way back in June.
Thanks to negative interest rates in Switzerland and the SNB’s willingness to participate in the foreign exchange market, investments in the Franc are seen as much less attractive. As such, it will be interesting to see how the Swiss economy fares going forward seeing as Switzerland is one of the stronger EU economies.
Weekly Jobless Claims Fall by More Than 10k
Claims for unemployment benefits in the United States last week fell by 11,000 to a seasonally adjusted average of 264,000. This seasonally adjusted average of jobless claims marks a 2-month low seeing as expectations were for the number of claims to remain right around 275,000. Clearly, as the weeks move forward, the US job market is gaining strength.
The Labor Department went on to say that the 4-week moving average of jobless claims, which is seen as a more accurate reflection of the job market, fell by 3,500 to a new average of just over 272,000. All in all, this week’s labor figures came back better than expected.
Fed Holds Rates
As most people were expecting, the Federal Reserve decided today that it would keep interest rates locked at their current levels. It has been nearly a decade since interest rates were risen, and for many months investors and experts alike pointed to today as the day when rates might finally be raised.
In a statement, the Federal Reserve made it clear that “Recent global economic and financial developments may restrain economic activity somewhat and are likely to put further downward pressure on inflation in the near term.” This statement was a very clear allusion to the downturn we are currently witnessing the Chinese economy suffer. China has been doing poorly from an economic standpoint for some time now, but more recently has taken an even more drastic turn downward. Despite all of this, the Fed maintained that it plans on raising rates before the end of the year should the US economy continue along its current course of growth. All in all, today’s conclusion to the Fed’s September meeting was not to be expected, but did offer a bit of insight into when rates will be raised. After all, there are only three more months after September left in the year.
Wrap-Up
As we wrap things up here on Thursday, our attention turns to tomorrow and how foreign markets will react to the Fed’s inaction. Most markets overseas were seen moving in a direction that suggested they did not expect the Fed to raise rates, so I do not envision a Friday that will bring about too much noteworthy market activity. Precious metals clearly benefitted from today’s lack of a decision, but gains made are likely to be short-term in nature according to so many experts.
