Gold Spot Price Open: $1,253
Gold Spot Price Close: $1,237
Change in Gold Spot Price: -$16
Silver Spot Price Open: $15.58
Silver Spot Price Close: $15.51
Change in Silver Spot Price: -$0.07
Precious metals started out the week rather unimpressively as both gold and silver suffered the wrath of profit-taking and a corrective pullback after last week’s gains. When all was said and done, gold lost more than fifteen dollars while silver edged downward by nearly 20 cents. Platinum and palladium also finished down on the day, both metals by about 5 dollars apiece.
Profit-Taking Takes its Toll Ahead of FOMC Meeting
After gold hit a 13-month high on Friday, everyone was afraid of how metals might open this week up. Unfortunately, neither gold nor silver began things in impressive fashion as profit-taking ended up preventing any gains from being made on Monday. Stock markets across the globe were seen performing a bit better too, as risk-appetite is very noticeably stronger now than it was roughly a week ago.
The big news of the week will kick off tomorrow in the form of the Federal Open Market Committee meeting that is set to last until Wednesday afternoon. As it stands, almost no one is expecting the FOMC to announce any changes to monetary policy this month, but people will be paying close attention to what Janet Yellen has to say during her post-meeting Q&A session with the press. As has been the case for quite some time now, investors are concerned about when the next interest rate hike is going to take place. Prior to the economic downturn that has consumed much of the first part of this year, investors the world over were anticipating month-by-month increases throughout the entirety of this year. So far that has proven to not be the case, and so long as economic conditions persist as they have been lately it is looking like interest rate hikes will simply have to continue to be put on hold.
Investors will also be interested to hear what the Fed thinks about the state of the US economy. Recent data has been confusing to say the least, and it will be interesting what the official word regarding the economy is.
Euro Falls Despite Upbeat Data
Even though the European Union reported upbeat economic data to begin this week, the euro currency continued to edge lower. Before most markets opened today, it was reported that European industrial production was up by more than 2% from December to January. In addition, year-by-year industrial production was up by 2.8%, which marks a six year high. This data is all fine and good, but it does little in the way of altering the wider view of the European economy.
With the euro showing more signs of weakness to start out this week, it should not come as much of a surprise that the US Dollar inched forward. Of course, with the FOMC meeting looming large it is clear to see that most investors are content to hold their positions and see what the Fed has to say. There isn’t much being expected to come as a result of this week’s meeting, but with the lack of fresh news trickling in this week it is bound to gain a lot of attention from the investing world.
Wrap-Up
All in all, Monday offered a rather lackluster start to the week. Tomorrow will see things pick up upon the start of the monthly FOMC meeting, but even that won’t really have an impact until it wraps up on Wednesday. Gold and silver are in a favorable position because there is just enough uncertainty to keep safe-haven demand going strong. Unless something changes drastically in the near future, that same demand will more than likely continue to hang around.
