Posted on February 25, 2015
Gold Spot Price Open: $1,198
Gold Spot Price Close: $1,205
Change in Gold Spot Price: +$7
Silver Spot Price Open: $16.27
Silver Spot Price Close: $16.62
Change in Silver Spot Price: +$0.35
Precious metals were given a bit of a lift on Wednesday thanks to some bargain-hunting buying and increased physical demand. When all was said and done, gold managed to gain more than 5 dollars while silver improved by little more than 30 cents. Platinum and palladium finished the day mixed, but did not move too far from where they opened.
On her second of two days’ worth of testimony, Fed chairperson Janet Yellen today addressed a US House panel regarding the stature of the US economy as well as what we can look forward to as the year progresses. By the time she had concluded her remarks, however, it was clear to see that Wednesday’s remarks were none too different than what she had to say on Tuesday. Once again she reiterated that the instability currently present in the global marketplace is acting as a major deterrent for the hiking of interest rates. Instead, she maintained that the interest rate hike discussion will be on a meeting to meeting basis and that there is, as of now, no set time when rates will be hiked in the US.
As a result of her more dovish tone over the course of the past few days, opportune investors looked to get their hands on metals after prices recently took a dive. I do not think today’s uplifted physical demand and bargain-hunting attitude will be able to be sustained, however, so I would be none too surprised to see spot values retreat once more before the week is through.
Over the course of the past week or more, it has been pretty apparent that most Asian traders and investors are not partaking in their normal trading and investing routines. The reason for this is due to the fact that the Lunar New Year is currently being celebrated all across Asia. This extended celebration is often marked with gift-giving, and often times the gifts that are given are either made of or contain precious metals, namely gold.
Thanks to recent dips in price, Asian customers have increased their demand for gold. Thanks to this increased physical demand, spot values have been able to derive a bit of a defense against most bearish outside market forces. Unfortunately, the Lunar New Year is only here for a short while, so there is no saying where metals will derive support from once this batch of increased physical demand subsides. As it stands now, the near-term future for precious metals is looking bleak, especially because economic and financial issues across Europe have been put on the back-burner…for now.
As we head into the final two days of this trading week, investors will have a bit of US economic data to mull over. Not only will we be dealt the latest weekly jobless claims report, but a few other month-end pieces of economic data are set to be made public. With so little else happening across the global marketplace, I would not be at all surprised to see the next few days’ worth of data impact the precious metals market in some way or another.