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    Debate, PCE Estimates Could Move Markets to Close out Busy Week

    Investors will be closely watching tomorrow’s first presidential debate and Friday’s key personal consumption expenditures price index estimates for May, which are two events that could provide some early Fourth of July fireworks.

    Kicking off the home stretch, Democratic President Joe Biden is set to debate Republican challenger Donald Trump Thursday night, marking the start to a period of potential market volatility in the runup to November’s general election as investors attempt to gauge how each candidate’s policies will affect their portfolios. 

    Political uncertainty typically bodes well for precious metals like gold and silver, as buyers seek refuge in their reputation as safe-haven assets to own in troubling times. But as we’ve seen time after time this year, traditional market rules haven’t always applied. 

    Reports on initial jobless claims, durable goods orders, and pending home sales are also expected on Thursday. 

    The main event will come Friday, with the release of May’s core PCE index, the Federal Reserve’s preferred method of measuring inflation. Last month, core PCE – which excludes food and energy because their often-erratic price swings make it difficult to glimpse an accurate spending picture – rose by 0.2% month over month and 2.8% year over year, according to the U.S. Bureau of Economic Analysis. 

    Economists have projected May’s core PCE to show a 2.6% rise in prices when figures are released on Friday, down from 2.8%.

    Wall Street is hoping the results will help build a case for federal policymakers to finally lower interest rates sometime this year. 

    “It seems May was an inflection point for the U.S. economy, with consumer sentiment, consumer spending, unemployment, and inflation all pointing toward a slowdown in economic activity,” Ernst & Young chief economist Gregory Daco told U.S. News & World Report this week. “Not a retrenchment, but rather more prudence on the part of consumers and business leaders facing the burn of cost fatigue and higher interest rates.”

    Gold continued to slide in mid-Wednesday trading, down $20.10 at $2,300 per ounce, while silver started to show some signs of life, barely holding on in positive territory, up $0.04 at $28.91 per ounce.

    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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