Gold Spot Price Open: $1,188
Gold Spot Price Close: $1,181
Change in Gold Spot Price: -$7
Silver Spot Price Open: $16.22
Silver Spot Price Close: $16.17
Change in Silver Spot Price: -$0.05
Gold and silver backed down slightly on Friday but still managed to close this week out positively. When all was said and done on Friday, gold lost only about seven dollars while silver lost somewhere around five cents. Platinum moved upward by more than 15 dollars on Friday while palladium moved downward by close to ten dollars.
Rate Outlook Changes Again
The outlook on interest rate hikes took another shift today, as many investors now think that while interest may not be hiked this month, they will be before the end of the year. As a result, the US Dollar took some nice steps forward, seen in gold and silver’s small moves downward. The USD Index, which measures the greenback against a basket of other currencies, rose today after hitting a 7-week low only a day ago. The Dollar may continue to rise too, as more ECB monetary policy shifts are on the table. According to Lee Ferridge of State Street Global Markets, “In the near term, the dollar could gain further against the euro as there’s more speculation about more QE from the ECB.”
A mixed bag of economic data was released today, and that once again has investors thinking that rates may, in fact, be raised before the end of the year. I know I sound like a broken record, but the fact of the matter is that the interest rate outlook changes on a daily basis and no one really knows what to think. For this reason, we will see the focus of the marketplace turn to the upcoming FOMC meeting, scheduled to be held a few days before the end of the month.
Crude Oil Prices Stabilize
For much of the week, falling crude oil prices put a damper on any and all gains made by gold and silver. While gains today are nice, it is not looking like they will be able to be sustained. CHS Hedging, in a statement, said, “Rig counts out today will influence trade into the weekend. A crude surplus of 106 million barrels against the five-year average is a bearish cloud over the market.”
Crude oil is a leading commodity, so more often than not the action of oil directly influences the progress of gold and silver. Keep in mind, Iranian crude oil still has a very realistic chance of making it into Western markets in the near future, and that much may push the value of crude oil even further downward. As it is clear to see, the ending of this week was fairly uneventful. Looking ahead to the next week, eyes will be on the crude oil market because the prices there have been fluctuating dramatically recently.
Wrap-Up
All in all, this is a positive week for gold and silver as gains were made and multi-week highs have been recorded. As is always the case, the real challenge is whether or not gold and silver will be able to resemble what happened this week. The precious metals market is still in a state of limbo with investors not sure whether to buy into metals completely, or sit back and see how things unfold between now and the FOMC meeting. For now, investors can reflect upon a positive week for metals overall.
