Gold Spot Price Open: $1,258
Gold Spot Price Close: $1,226
Change in Gold Spot Price: -$32
Silver Spot Price Open: $20.38
Silver Spot Price Close: $19.54
Change in Silver Spot Price: -$0.84
Gold and silver both fell sharply on a relatively quiet day across the world marketplace. When markets closed, gold lost over 30 dollars while silver declined by a little more than 80 cents.
With no bullish economic news for investors to fall back on, technical selling was once again the most prevalent event in the precious metals market today. Also fueling a growing investor urge to sell gold and silver is yesterday’s bipartisan budget agreement. With one less geopolitical question mark hovering over the marketplace, investors are beginning to take more risks with their investing funds. Typically, when investors are taking on more risk, interest in precious metals declines.
Another possible outcome of yesterday’s budget deal is that the Fed may have more reason to begin tapering Quantitative Easing. Recently strong economic data in conjunction with a calmer geopolitical environment in the United States may be the perfect combination of events for the FOMC to employ tapering. Despite the possibility of a tapering announcement being made at next week’s FOMC meeting, the likelihood that it will cause a major stir in the marketplace is not as great as it was a few months ago. At this point, the market is expecting to hear of a reduction to Quantitative Easing sometime in the near future and the precious metals market seems to have already adjusted to it.
There was some US economic data released on Thursday, but it was a mixture of positives and negatives and therefore had no real impact on precious metals spot values.
In other news from around the world, EU industrial output was reported as being down by over one percent this past October. This number was in stark contrast to the market expectation of an industrial output increase of almost .3% between September and October. This poor report is perhaps more impetus for the ECB to retain its easy monetary policies.
As we bring this week to a close, it will be interesting to see if gold and silver fall further due to technical selling or if a geopolitical development and/or bargain-hunters will be able to relieve some of the current downward pressure.
