Gold Spot Price Open: $1,182
Gold Spot Price Close: $1,177
Change in Gold Spot Price: -$5
Silver Spot Price Open: $15.73
Silver Spot Price Close: $15.78
Change in Silver Spot Price: +$0.05
Precious metals finished the day mixed, but didn’t really participate in that much movement on Tuesday. When all was said and done, gold lost a few dollars while silver actually managed to gain close to ten cents. Platinum and palladium both finished the day having posted modest gains, under 10 dollars.
Revised GDP Reading Moves Upward
The US economy has been outpacing many of its rivals over the last half of a year or so, that much is no secret at all. Just today, the US Department of Commerce released a 3rd-quarter GDP revision and the upward movement of the revision was surprising.
According to the revised report, the US economy grew by an impressive 5% over the course of July to September. This level of growth was the fastest in more than a decade and was fueled by an increase in consumer spending and business investment. Another thing this report does is reaffirm the belief that the US economy is, in fact, one of the strongest in the world at the present moment in time.
With 4.6% growth recorded from April to June, and 5%+ growth recorded from July to September, it is clear to see that the US economy is closing out 2014 on a very strong note. Now, as we head into the New Year, the number one question on the minds of investors will continue to be when interest rates in the US will be raised. Though we know the US economy is currently a top-performer, it is going to take a more robust level of growth on the part of other global economies before interest rates here at home can be hiked.
Stocks Continuing to Trend Higher
Thanks to the upwardly-revised GDP report from the United States, stocks here and around the world are adding value for yet another day. Here in the US, stocks have fared well over the past 5 days and are only seeming to get stronger as more upbeat economic data is reported and interest rate hikes continue to be pushed further and further back. As we head into the New Year, you can already see a pattern forming, and it is one that looks to be quite adversarial to any progress made by precious metals.
It isn’t only US stocks that are performing well this week either, as European and Japanese equity markets have been seen adding value of their own. This is yet another factor that is doing the precious metals market no favor. As is probably well-known by this point in time, as investors become more confident in a market, the riskier they tend to be. Because risk-appetite is fairly high at the present moment in time, the desire on the part of investors for safe-haven precious metals is simply not there. While this could change at the drop of a hat, it seems as though risk-appetite may persist through to the end of the year and potentially even beyond that too.
Making matters even worse for gold and silver is the fact that the USD index is also faring pretty well this week. As you could have probably guessed, the Dollar, like stocks, began trending upward in the wake of the better than expected GDP revision.
Wrap-Up
To be fair, today was a much quieter day at the market, even despite the US GDP report. Looking ahead to tomorrow, I anticipate that things will run along the same lines as there will be even fewer traders on the trading bloc and a general void of economic data. There will be more market activity come Friday, but even then I think things will be fairly quiet.
