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    JM Bullion Gold and Silver Market Update (10/18/16)

    Gold Spot Price Open: $1,258

    Gold Spot Price Close: $1,264

    Change in Gold Spot Price: +$6

    Silver Spot Price Open: $17.52

    Silver Spot Price Close: $17.59

    Change in Silver Spot Price: +$0.07

    Precious metals added on Tuesday to a decent performance a day earlier, this time thanks to some lackluster economic data as well as a weaker US Dollar. When all was said and done, gold managed to tack on around 6 or 7 dollars while silver added about 7 cents. Platinum and palladium both gained during the morning hours, but fell before day’s end, with platinum picking up more than 5 dollars while palladium lost roughly 3.

    US Dollar Backtracks Again

    Something that has helped gold and silver through the first few days of the week has been the pullback on the part of the greenback. The US Dollar, since the last few weeks of last month, gained in upwards of 3% before the growing pullback that has been in place since the end of last week. With investors confident that rates are going to be risen at some point in the near future, it should come as no surprise that the Dollar is doing as well as it has been.

    In truth, last Friday’s retail sales report did the Dollar little favors and is being pointed to as a pretty major reason as to why we are seeing a pullback. Despite that, the overall tone with regard to rate hike expectations has not changed. Just like it was always going to take more than one solid piece of economic data to convince the Fed it is time to hike rates, it is going to take more than one piece of so-so data for the Fed to change their position. As it stands, most people are anticipating a rate hike announcement to come as part of the December FOMC meeting, and it is going to take a lot to change that.

    US Inflation Data in Line with Expectations

    According to a report released earlier today, September’s Consumer Price Index rose by .3% on an annualized basis. This number was about in line with expectations but also a bit lower than what the Fed would like to see. As a result, gold and silver benefitted marginally. In similar news, the UK’s Office for National Statistics released a report showing that September’s CPI rose at the fastest rate in more than 2 years. For September alone, the rise was 1%. This was the highest single-month CPI rise the UK has seen in well over 2 years.

    Going forward, and so long as interest rate hikes are, in fact, expected, the marketplace is going to look very closely at any and all inflation data. Naturally, inflation in the US is hugely important in the Fed’s decision to raise or not raise rates, but it isn’t only US inflation the Fed is concerned with.

    Also helping precious metals were firmer crude oil prices. Today, the average price of a barrel of crude oil trekked above $50. The $50 threshold has been an important one for a long time and that will continue to be the case. With that being said, however, the overproduction that is still running rampant across the crude oil industry is something that will likely prevent any large, sustainable gains from being made.


    All in all, Tuesday was a decent day for precious metals. When you consider the current state of the global marketplace and the expectations of investors, it really does not lend itself to appreciating gold and silver spot values. This will likely be the case for some time now, but if outside markets are as bullish as they have been through the first two days of the week, metals might be able to trek sideways or slightly up.

    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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