Gold Spot Price Open: $1,232
Gold Spot Price Close: $1,265
Change in Gold Spot Price: +$33
Silver Spot Price Open: $15.33
Silver Spot Price Close: $15.21
Change in Silver Spot Price: -$0.12
When markets opened on Wednesday, there was a sense of calm due to the fact that most investors were content to wait until they could hear what the Federal Reserve had to say in the wake of their monthly meeting, which wraps up today. After that calm came a but of a craze as investors reacted to what the Fed had to say. When the day was through, gold gained a little more than 30 dollars while silver managed to lose a few pennies more than ten cents. Platinum and palladium did not do extremely well on the day and finished mostly unchanged.
Upbeat US Economic Data Dealt Ahead of FOMC Statement
While most investors were holding their positions in anticipation for the Fed’s post-meeting statement, the rest of the market was dealing with some economic data from the United States. First was core inflation, which rose by unexpected margins during the month of February. Housing starts in February were also on the rise, and both these data points ended up giving the US Dollar a boost against rival currencies.
A day earlier, in Japan, the Bank of Japan decided against altering its massive asset-buying monetary stimulus program despite many believing that they would. Adding another blow to the situation is the fact that the BoJ was not necessarily upbeat with regard to how they felt about the future of the country’s economy. Though Japan has not been in the news recently lately, make no mistake, their economy is doing poorly and is looking like it will continue to perform exactly like that throughout the near-term.
FOMC Leaves Interest Rates Unchanged
As expected, the Federal Open Market Committee decided that it would not touch interest rates for the time being. Now, experts are pointing towards June as the time when a .25% interest rate hike might finally come about. At this point there is little to support such claims, but the feeling is that interest rate hikes are on the horizon one way or another.
In the FOMC’s post-meeting statement, members of the Fed announced that they are extremely confident in the US economy even despite other global factors. As you are more than well aware of at this point, the state of the global economy can best be described as “in shambles.” The biggest takeaway from the statement was that “economic activity has been expanding at a moderate pace despite the global economic and financial developments of recent months.” This statement was perceived as being more positive than anything else, but the Fed really didn’t tell investors anything that they did not already know.
As we move forward, the speculation will undoubtedly continue with regard to when interest rates can be hiked again. Though people are pointing towards June, the fact of the matter is that future hikes will depend on the state of the global and US economies. The original thought was that the Fed would be hiking interest rates each and every month throughout the year. In the coming weeks and months the biggest focus for investors will be the status of US employment, and whether jobs are being added and if payrolls are growing.
Wrap-Up
Wednesday was not the most eventful day, which is especially surprising because of the FOMC meeting. When the Fed more or less offered no changes to monetary policy, investors did not have much else to talk about. There was some economic data dealt, but it did not have any sort of major impact on the marketplace. Gold and silver mostly held their positions, so it will be interesting to see how metals open up the day on Wednesday.