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    JM Bullion Gold and Silver Market Update (3/18/16)

    Gold Spot Price Open: $1,232

    Gold Spot Price Close: $1,259

    Change in Gold Spot Price: +$27

    Silver Spot Price Open: $16.06

    Silver Spot Price Close: $15.80

    Change in Silver Spot Price: -$0.26

    After making massive gains on Thursday, it isn’t coming as much of a surprise that precious metals spot values backed off a bit on Friday. When all was said and done, gold dropped little more than nine dollars while silver fell by almost 15 cents. Platinum and palladium ended the day mixed, with platinum losing more than ten dollars while palladium gained about 4 or 5.

    Better Risk-Appetite Hurts Metals

    Some profit-taking and a higher level of risk-appetite are taking their collective toll on gold and silver today. After making massive gains on Thursday, most metals are backing down today. What is encouraging, however, is the fact that losses incurred today are nothing major and do not even come close to equaling the gains made a day ago.

    Prompting today’s higher incidence of risk-appetite is the fact that most global stock markets opened up Friday in positive fashion. Even US equity markets, most of which are hovering near 2-month highs, began the day boasting an upward trajectory. This can perhaps be, in part, attributed to the better than expected employment report released on Thursday as well as the Fed’s positive comments regarding the current state and future of the US economy. With so much economic turmoil continuing to take place in other parts of the world, it should come as no surprise that gold and silver are still managing to hold their own despite stocks performing so well.

    As we look ahead to next week, it is going to take a lot for equities to continue performing as well as they have today. Knowing this, I would not be at all surprised to see precious metals open up trading next week in positive fashion.

    IMF Says Negative Rates Have Aided Global Economy

    If you have been paying attention to global economic news lately, you know full-well that you can find negative interest and deposit rates in many regions of the world. Most recently, the EU and Japan instituted negative rates in order to help their respective economies combat increasingly worrisome economic conditions. While some people have scoffed at the idea of widespread negative rates, the IMF has touted them as being extremely helpful in aiding global economic recovery.

    In an interview, IMF managing director Christine Lagarde commented on negative rates and their impact by saying, “If we had not had those negative rates, we would be in a much worse place today, with inflation probably lower than where it is, with growth probably lower than where we have it. It was a good thing to actually implement those negative rates under the current circumstances.”

    While Europe and Japan have already gone full steam ahead with negative rates, the United States has not. Despite this, Janet Yellen has made it clear that she and her colleagues are looking into negative rates should the time come for them to be implemented. But with negative rates being a newer entity in the economic world, many are simply sitting back and waiting to see what the longer-term impact negative rates might have on local economies as well as the global economy as a whole.

    Wrap-Up

    For gold and silver, this week was a positive one as both metals will enter the weekend having made gains over the past 5 days. The biggest news point was undoubtedly the FOMC meeting which took place from Tuesday to Wednesday, but that did not exactly yield any fresh, groundbreaking economic news. Looking ahead to next week, it will be interesting to see if metals can sustain their current momentum, or if a more severe batch of profit-taking and chart consolidation will doom them to a continuation of today’s losses.

    Disclaimer: All Market Updates are provided as a third party analysis and do not necessarily reflect the explicit views of JM Bullion Inc. and should not be construed as financial advice.

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