Posted on January 20, 2015
Gold Spot Price Open: $1,278
Gold Spot Price Close: $1,296
Change in Gold Spot Price: +$18
Silver Spot Price Open: $17.74
Silver Spot Price Close: $17.98
Change in Silver Spot Price: +$0.24
After suffering decent losses on Monday, precious metals bounced back nicely on Tuesday. When all was said and done, gold picked up about fifteen dollars while silver managed to gain more than twenty cents. Platinum and palladium also posted decent gains today, between $15 and $20 each.
Though this week is undoubtedly one of the more important ones we have witnessed in 2015, today offered investors very little in the way of fresh data. Because of this, precious metals continued to benefit from the overall level of uncertainty and anxiety being exhibited by investors. With a bunch of big announcements expected to be made by the time this week is over, most investors are expecting the market to be more or less flipped on its head. In reality, however, no one really knows how this week will end, and for that reason are flocking to safe-haven metals.
Gold is now sitting at about a 5.5 month high and is just under $1,300/ounce. Silver is also on the verge of crossing a key technical threshold as it sits just barely below $18/ounce. As this week plays out, it will be interesting to see if gold and silver can break through these points of technical resistance. Furthermore, if they can break through the $1,300 and $18 marks, it will be intriguing to see how long those positions can be held.
In news from the early morning hours, it was reported that the International Monetary Fund reduced its global growth expectation by .3% to a new forecast of 3.5% for the year. Though there are a number of factors that contributed to this reduced forecast, the IMF cited the depreciation of currencies against the Dollar as the main reason for their reduced growth expectation.
The fact that the US economy and US Dollar are both outperforming many of their rivals is contributing to the growing belief that the Federal Reserve may hold off on hiking interest rates until much further down the road. Unless global economic conditions improve, most experts agree that the Fed simply will not stand to gain much by raising interest rates in any capacity. Of course, the interest rate discussion will continue as the year progresses and as the global economic climate changes.
US stocks as well as the US Dollar also had an upbeat day on Tuesday, but it is safe to say that precious metals continue to be the real winners. Looking ahead to tomorrow, I anticipate that things will be much like they were today, with most of the market focusing on what the expected ECB decision will mean for them and their investing decisions. As equity markets continue to exhibit volatility, however, it is highly likely that gold and silver will continue to benefit as this week moves forward.