Gold Spot Price Open: $1,087
Gold Spot Price Close: $1,073
Change in Gold Spot Price: -$14
Silver Spot Price Open: $14.60
Silver Spot Price Close: $14.35
Change in Silver Spot Price: -$0.25
After making nice gains to end the week last week, gold and silver opened up this 5-day trading session by backing down by considerable margins. When all was said and done on Monday, gold lost in upwards of fifteen dollars while silver finished downward by nearly 30 cents. Platinum and palladium also lost on the day, with platinum down by more than twenty dollars while palladium lost more than fifteen.
Gold Back Near 6-Year Low
After making some encouraging gains on Friday of last week, precious metals opened this week by backtracking. After ending last week around a 2-week high, a downward correction pushed spot values back down towards multi-year lows. Across the global marketplace, equity indexes were firmer to start the week and were mostly following the lead set by US equities on Friday. Most times, positive performance on the part of global equities is something that tends to work against the precious metals market.
Currency markets were more mixed than anything else on Monday as investors continued to react to the European Central Banks holding off on expanding quantitative easing for the time being. In case you missed it, the ECB towards the end of last week announced that rather than expanding QE, it was content to simply extend this monetary policy and hold off on making any other changes. As a result, the Euro was able to regain some of the value it had recently lost to a stronger greenback.
As for US economic data, Monday did not offer much in the way of markets-moving data points. As a result, investors were mostly preoccupying themselves with the ECB and what QE expansion means for the region from an economic growth standpoint. More November US economic data is expected to be published this week, and you can bet that investors will be paying particularly close attention.
Oil Prices Continue to Weigh on Metals
Something we haven’t talked about recently, but has still been a thorn in the side of precious metals is the fact that crude oil spot values remain at multi-year lows thanks to an unprecedented supply glut driving prices downward. Typically, oil will heavily influence the price action of other commodities, and at present crude oil’s slump is offering gold nor silver any relief from the losses suffered as a result of the belief that interest rate hikes will be announced in less than a week’s time.
Many experts are looking at OPEC and their general inaction as a reason behind crude oil’s fall to a near 7-year low. A hotly contested topic amongst OPEC members is what should be done to address the possibility of Iranian oil being allowed in Western markets should sanctions be lifted; something that remains a very real possibility. With members of OPEC in utter disagreement about what should be done to address the above problem, this is yet another situation that OPEC has yet to really react to.
Now, with the US producing more oil than ever and not looking like slowing up anytime soon, investors and market experts are wondering what is preventing crude oil from falling even further than it already has. This is just one more thing to pay attention to as we look towards the New Year, as it will assuredly continue impacting the spot values of gold and silver.
Wrap-Up
Truth be told, Monday was a mostly quiet day across the global marketplace. Investors were content to reflect on what did or didn’t happen towards the end of last week, and thanks to a lack of any fresh fundamental data there wasn’t much to talk about. As the week wears on and the economic data picks up, however, you can bet that things will be a bit more exciting. Whether that means good or bad things for precious metals remains to be seen.
