Posted on March 23, 2017
Gold Spot Price Open: $1,254
Gold Spot Price Close: $1,250
Change in Gold Spot Price: -$4
Silver Spot Price Open: $17.68
Silver Spot Price Close: $17.56
Change in Silver Spot Price: -$0.12
Precious metals backed down a bit on Thursday, but are still looking strong in the near-term thanks to a host of bullish outside forces. When all was said and done on Thursday, gold ended the day down by about 4 dollars while silver concluded the day having lost close to 12 cents. Platinum and palladium, on the other hand, finished the day mixed. Platinum was down by a few dollars but palladium ended the day up by about 15.
In the lead-up to Thursday’s House vote regarding the Affordable Care Act, the big point of contention was whether or not Republicans could garner enough support to overturn the bill commonly referred to as Obamacare. This vote is much bigger than most might think, because it is being viewed as a test of how much control President Trump has over his Senators and Representatives. Flashback to a month ago, and the US Dollar was gaining on rumors that President Trump’s fiscal policies—including tax cuts and getting rid of Obamacare—would give the US economy a significant boost.
With the vote having not happened today and instead being delayed, there are serious doubts with regard to whether President Trump and his cabinet can actually influence change. Talking about this earlier today was Alvise Marino, strategist at Credit Suisse. He said, in part, “Today, more than anything, the U.S. House vote is what people are looking at. that suggests the government’s ability to actually introduce meaningful changes and meaningful policies is probably going to be considered lower.”
Precious metals were given a marginal amount of bullish support from a weekly jobless claims that saw the number of people filing for first-time unemployment benefits rise by a good bit. According to the US Department of Labor, last week saw 15,000 more people file for first-time unemployment benefits from the week before. This 15,000 claim increase brought the seasonally-adjusted average up to 258,000.
While we are still sitting well below the 300,000 seasonally-adjusted average threshold, any increase in the number of folks filing for unemployment tends to come to the aid of precious metals. This is especially true considering the fact that expectations were for the seasonally-adjusted average to remain in the 240,000 range.
Even the 4-week moving average number of claim was up by 1,000. This is a not so great sign, but is not one that will cause too many people to worry.
While most of the events of Thursday would lead you to believe that gold and silver spot values would increase, the opposite actually took place. The reason for this can be attributed to investors who are cashing in on gains made over the past week or so. Since the FOMC interest rate announcement was made last week, gold and silver have been gaining value at a fairly steady rate. Whenever this happens, we almost always reach a breaking point of sorts where investors decide to cash in on short-term gains. With that being said, there are still plenty of reasons to believe that metals will continue to perform well in the near-term.
All things considered, there was a lot of action on Thursday when compared to the rest of the week. For gold and silver, the news was mostly bullish despite the fact that spot values backtracked. Friday will prove to be a pivotal day as we will see if gold and silver can make a second consecutive week of gains, or if today’s dip will extend and become something a bit more serious. As it stands, there is not a wealth of economic data on the slate for tomorrow.