Gold Spot Price Open: $1,152
Gold Spot Price Close: $1,142
Change in Gold Spot Price: -$10
Silver Spot Price Open: $16.16
Silver Spot Price Close: $15.77
Change in Silver Spot Price: -$0.39
Precious metals declined on Thursday after beginning the week rather impressively. When all was said and done on Thursday, gold lost about ten dollars while silver’s losses came closer to forty cents. Platinum and palladium, on the other hand, both gained close to ten dollars on the day.
Investors Anxiously Await Release of Fed Minutes
One of the biggest news stories of the week will come soon in the form of the most recent minutes from the Fed’s meeting in September. Due to the growing belief that interest rates will not be hiked this month, it is easy to see why investors are putting so much weight on the minutes. That, and there really isn’t much else happening across the global marketplace other than interest rate hike speculation. With some luck, the Fed’s minutes will offer up some more insight as to what the Fed plans on doing with interest rates, whether it be this year or next.
Omer Esiner, of Commonwealth Foreign Exchange, made a comment on current market conditions and the expectations of investors by saying, “While financial market volatility has eased somewhat since the Fed’s last meeting, many doubts about the health of China and emerging economies remain, which is likely to dampen the prospects of a Fed rate hike this year and likely keep the dollar’s gains limited.”
According to multiple polls taken over recent weeks, there is a 38% percent chance that rates will be raised by the time this year is through. That is a drastically smaller likelihood than we saw about a month ago, and an even larger drop off than what we witnessed 3 months ago. The Fed is scheduled to hold their next meeting within a few weeks so this is data is a major precursor to that.
Poor German Data Shakes Up EU Marketplace
EU equities finished the day having posted mixed results thanks to some weaker than expected German economic data. Officially, German exports during the month of August were the slowest we have seen in more than 6 years. As a leading EU economy, seeing this kind of statistic coming from Germany is never a good thing. In addition to Germany disappointing from an economic standpoint, we are seeing other emerging EU economies struggle as well.
The minutes from the European Central Bank’s most recent meeting were released today, though they did not shake up the marketplace all that much. All in all, investors are more worried about what is happening, or not happening, in the US more than anything else. The EU is reportedly on the verge of receiving even more accomodative monetary policy, so that is another story we will have to keep an eye on over the course of the coming days and weeks. Should the economic slowdown continue to negatively affect Europe, however, there really isn’t much the ECB can do other than instituting even more relaxed monetary policies.
Wrap-Up
Frankly, Thursday was not the most exciting day across the global marketplace and was, really, in line with what we have seen through the week so far. Now, the attention of the global market turns to the Fed’s upcoming meeting and what it might mean for interest rates. I am of the belief that interest rates will be left unchanged, but we know all too well that the Fed loves making moves when people are least expecting them.
