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    JM Bullion Gold and Silver Market Update (1/18/17)

    Gold Spot Price Open: $1,216

    Gold Spot Price Close: $1,206

    Change in Gold Spot Price: -$10

    Silver Spot Price Open: $17.21

    Silver Spot Price Close: $17.04

    Change in Silver Spot Price: -$0.17

    Precious metals spent the day on Wednesday reacting to a bunch of US economic data points and finished the day moving lower. When all was said and done, gold ended up losing 10 dollars while silver lost more than 15 cents. Platinum and palladium both lost on the day, however platinum’s losses outpaced those of palladium.

    US Inflation at Highest Level in Years

    Of the many data points made public on Wednesday, few were more heavily extrapolated upon than the inflation data that was published. According to the US Department of Labor, the Consumer Price Index rose by .3% in December. This was about in line with expectations and did well to build upon November’s rise of .2%. Driving the increase in consumer prices was the energy sector, which accounted for a 1.5% increase. Breaking this down further, gas prices were up 3% in December from the month before.

    As for inflation on an annual basis, the Department of Labor showed that it rose by 2.1% throughout the whole of 2016. This was the first time since 2014 that inflation rose above the Fed’s target of 2%. For gold and silver, rising inflation is something that tends to, historically, help prop up precious metals’ spot values. Right now, however, rising inflation is not having such a positive impact on gold and silver because the upwardly moving inflation is something that supports the idea that the Federal Reserve will increase rates at least 1 or 2 more times during 2017. As you probably know by now, the prospect of even higher interest rates is something that does well to kill interest in safe-haven precious metals.

    Other US Economic Data Dealt

    Another big piece of economic data that was released on Wednesday came in the form of the industrial production report from this past December. Though many people thought that this figure might be smaller, we received word of a .8% month on month increase in industrial production. This is the best single-month performance since 2014. To put this in perspective, even the most robust estimates only called for industrial production in December to show .6% growth.

    The news wasn’t all good on the industrial production front, however, because November’s data was revised to show a .7% month on month drop. Despite the contrasting figures from November to December, investors were happier about December’s figures than they were disappointed in November’s downward revision.

    After hitting an almost 12-month high in November, homebuilder confidence was reported as having backed off a bit in December. The index reading on this state fell slightly, but no one is overly worried about this seeing as the state of the housing market in the US is the best we have seen in years. In total, all of today’s data did well to further convince investors that the US economy is continuing along its path to full recovery. Even if people are confused with regard to what Donald Trump might do when he assumes the office of the President of the United States (this Friday), everyone can rest-assured knowing that the US is one of the best-performing economies in the world.

    Wrap-Up

    All things considered, today was a big day of economic data that did well to reinforce the belief that the US economy is doing well. An interesting thing that happened today was that, even despite this upbeat data, gold and silver were still able to output positive performances. We are currently seeing all of the uncertainty with regard to Donald Trump translate into safe-haven buying. There is no indication as to how long the safe-haven demand will stick around, but so long as the President-elect continues being his outspoken self, it seems as though this type of demand is not going to go anywhere in a hurry.

    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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