Gold Spot Price Open: $1,177
Gold Spot Price Close: $1,169
Change in Gold Spot Price: -$8
Silver Spot Price Open: $15.96
Silver Spot Price Close: $15.75
Change in Silver Spot Price: -$0.21
Gold and silver both lost some more value on Wednesday thanks to an overall dip in the commodities market. When all was said and done, gold lost closer to ten dollars while silver lost more than twenty cents. Platinum and palladium both spent a good majority of the day flirting between small gains and losses, and both metals finished marginally higher.
Dollar Makes Gains As Commodities Slip
Currencies that are more closely-linked to commodities fell today, prompting investors to seek safety in the US Dollar. The Australian Dollar in particular lost a good bit of value today.
China’s situation only seems to be growing worse by the day as it was reported that the Shanghai Stock Index fell by more than 3% on the day. This is about par for the course as China’s stock market has been in a state of extreme volatility over recent months. The Dollar also managed to gain against the Yen thanks to trade data that was less than impressive. After reporting about Canada’s recession yesterday, today we have news that Japan is on the verge of recession as well. Against the Canadian Dollar, the greenback managed to improve by more than 1% on the day to bring the exchange rate to roughly C$1.31:$1.
One of the only currencies that the Dollar did not gain against was the Euro, as investors await this week’s ECB meeting and any monetary policy announcements that may come with it. Some people are expecting the European Central Bank to ease monetary policy even further, but after yesterday’s somewhat upbeat European economic data others feel as though the ECB may refrain from touching monetary policy.
Lower Crude Oil Pushes Metals Downward
Commodities definitely took a bit of a beating on Wednesday, and that was seen in the price decline of a barrel of crude oil. Gold, silver, and other precious metals are still perceived to be in control of the near-term technical advantage, but if more upbeat data does not come soon, spot values may slip back downward in a hurry.
Profit-taking was also to blame for Wednesday’s losses, as gold and silver have both performed well over the past few weeks. Crude oil and its price action has been on the back-burner for some time now, but as Iranian talks loom just around the corner, the eyes of the marketplace will undoubtedly gravitate back to what the crude oil market is doing. If Iranian crude oil does eventually make its way back into massive Western markets, the already glutted oil supply will more than likely force prices downward. This, as you might have guessed, is not good news for gold and silver at all. With all this said, Iranian oil reaching Western markets still seems to be a ways away.
Wrap-Up
Apart from stocks in China having a fairly rough day, Wednesday was another somber day across the global marketplace. Now, investors are looking forward to the upcoming European Central Bank meeting as well as next week’s Federal Open Market Committee meeting. In Europe, investors will be hoping to hear of increased monetary policy easing, though that now seems unlikely. As for the US Federal Reserve, most investors are not expecting much in the way of big news as the major expectation is that interest rates will be kept steady.
