Posted on January 19, 2015
Gold Spot Price Open: $1,281
Gold Spot Price Close: $1,275
Change in Gold Spot Price: -$6
Silver Spot Price Open: $17.95
Silver Spot Price Close: $17.75
Change in Silver Spot Price: -$0.20
After spending most of the last two weeks making gains, both gold and silver have kicked this week off by pulling back a bit. When all was said and done, gold lost around 5 dollars while silver declined by a little more than 20 cents. Platinum opened the week by losing a few dollars, but palladium managed to gain marginal value.
In case you were unaware, the top concern for investors this week is undoubtedly the European Central Bank meeting. For the past few weeks, the ECB meeting has been a major point of concern for investors due to the fact that it is widely expected that a policy change announcement will come in the meeting’s wake. Just last week, the likelihood of a policy shift announcement increased dramatically due to the fact that the European Court of Justice ruled that the ECB’s plans to implement government bond-buying are legal.
For this reason, most of the global market is expecting the ECB to announce the implementation of quantitative easing measures to be put into action very soon. As a result of this, the Euro currency has been on the decline for much of the past few months and is expected to continue doing the same as this year progresses.
Though the ECB meeting is not going to wrap up until late morning on Thursday, expect the headlines this week to be dominated by talk regarding the ECB.
Now that the market has become more or less convinced that the ECB is going to soon implement quantitative easing measures, the real question remains whether or not these measures will be enough to help the European Union. It is no secret that the EU is in need of some help, but some analysts are wondering whether QE measures are the right thing for the EU to pursue.
As we open this week up, we are hearing a lot of talk from market experts and most of it is condemning the ECB’s intent on pursuing quantitative easing measures. The criticism stems from an overriding belief on the part of experts that just because QE worked in the United States does not mean it will help the EU. Citing things like the contrasting nature of the US and EU’s financial and economic structures, market experts are under the impression that QE may not be the best fit. It will be interesting to see, in the coming months, just what kind of impact QE measures will have on the faltering EU economy.
After the Swiss National Bank decided last week to unpeg its currency from the Euro, speculation immediately began claiming that other countries may be prompted to do the same. Denmark and its krone were one of the countries thought to be gearing up for a move away from the Euro, but such speculation was shot down earlier today through a surprising rate cut decision on the part of the Danish central bank.
Through the lowering of its main lending and depositing rates, the Danish central bank is actively attempting to keep the krone’s value in check. As this week carries on, it will be interesting to see what further news we receive from the European Union. As it stands, it is clear to see that most every investor is in some way preoccupied with happenings over in Europe this week.
If today’s main talking points are any indication, this week will see the market focus almost entirely on what is happening in Europe. Of course, the ECB meeting will be the week’s top event, but what little things happen in the lead-up to that meeting will also be watched over by investors closely. On top of it all, the market will also have some economic data to contend with from the United States. Since the dawning of 2015, most economic data from the US has been sub-par, so it will be intriguing to see how that data changes or remains the same as the weeks move forward.