Posted on January 05, 2016
Gold Spot Price Open: $1,078
Gold Spot Price Close: $1,080
Change in Gold Spot Price: +$2
Silver Spot Price Open: $13.96
Silver Spot Price Close: $14.05
Change in Silver Spot Price: +$0.09
After a bright start to the week, precious metals saw some follow-thru buying keep spot values trending slightly upward. When all was said and done, gold managed to gain just a few dollars while silver saw gains of nearly 10 cents. Platinum and palladium also posted some small gains on the day, with neither metal gaining more than a few dollars.
Gold and silver received a bit more support on Tuesday thanks to persisting worries regarding the Chinese economy and the stability, or lack thereof, of the Middle East. Calming down the global marketplace were moves made by the Chinese government to stabilize both stock markets as well as the yuan currency.
One of the moves made by China on Tuesday was to inject roughly 130 billion yuan into its bank system. The Chinese government also made moves within foreign exchange markets aimed at helping the yuan level out. In case you missed it, Monday saw China’s main equity index plunge at a rate not seen in some time, causing investors the world over to become concerned about the economic stability of the global powerhouse. US stock markets suffered in the wake of China’s poor performance Monday and did not do much in the way of making gains on Tuesday.
Something that has shocked investors from the US and elsewhere around the world is the fact that recently renewed tensions between Iran and Saudi Arabia have done little in the way of boosting crude oil prices. Typically, escalations, even of the verbal variety, between two nations from the Middle East forces the value of crude oil upward.
With that said, there is no denying that the global economy is experiencing a slowdown, and the reduced demand for crude oil as a result may account for today’s lackluster performance. The global supply glut, in addition to the economic slowdown, has been a major contributing factor to crude oil’s disappointing performance over the past few months. Something else that may come into play very soon is the fact that Iran may soon be able to ship their oil to Western markets. Existing sanctions are potentially going to be lifted in the near future, and this would mean that the current supply glut would only intensify in nature. This, of course, may be threatened by what has taken place over the course of the past week or so.
Being that crude oil’s price action often determines that of precious metals, any day that oil remains subdued it is going to be tough for gold and silver to make much of any gains.
Tuesday was, by most accounts, a quieter day across the global marketplace as stock markets in the US and elsewhere moved more sideways than in any other direction. Looking ahead to the last three days of the week, precious metals are likely to be sent through a bit of turbulence due to the overload of economic data that is due out. Most important of all the data points made public this week is the jobs report, which is expected to be made public on Thursday. Most people are anticipating that this data point will be upbeat in nature and help mark 2015 as one of the best years for employment in the last decade.
It will be interesting to see how the rest of the week pans out, that much is for certain.