Gold Spot Price Open: $1,267
Gold Spot Price Close: $1,254
Change in Gold Spot Price: -$13
Silver Spot Price Open: $15.50
Silver Spot Price Close: $15.35
Change in Silver Spot Price: -$0.15
After making gains through the first two days of the week, precious metals backed down on Wednesday thanks to a few different factors. When all was said and done, gold moved backwards by more than 10 dollars while silver fell by about fifteen cents. Platinum and palladium finished the day mixed, but neither metal finished too far from where they began the day.
Stocks, Oil Finish Higher on OPEC Rumors
Hurting gold and silver straight from the offing on Wednesday was the better posture of global stocks markets and crude oil prices. Prompting this role reversal of sorts was a rumor that began to spread today claiming that OPEC nations will be meeting in Moscow in 11 days. According to many sources, the meeting’s primary topic will be a production freeze agreement that will potentially be set in place to combat the growing oil supply-glut that we have been contending with for about a year now.
Before growing so confident that the rumored agreement will be put in place, it is important to note that OPEC has tried a few times over the past year to halt production to no avail. When it comes down to it, many OPEC nations see crude oil production and sales accounting for a majority of GDP, so when production is cut it has massive ramifications for an individual economy as a whole. Understanding this, it is difficult to believe that countries like Venezuela, who have very little diversification as far as GDP is concerned, will be as accepting to a production freeze as a country like Russia, whose economy makes money off much more than oil production alone.
We have a little more than a week to prepare for this OPEC meeting, so the hope is that some more information will trickle in before now and March 20th for us to mull over and discuss. For now, however, gold and silver are still looking at an upbeat near-term thanks to continued poor economic data and the widely held expectation that the ECB will move tomorrow to further boost the region’s easy money policies.
Further Easing Widely Expected
As was just mentioned, most investors around the world are fully expecting the European Central Bank to announce a shift in monetary policy at their meeting tomorrow. Seeing as the region has, time and time again, missed the mark as far as target inflation is concerned, the feeling is that easy money policies need to be expanded. This belief is working to push the euro downward against a host of rival currencies.
For gold and silver, the euro moving downward is helping the greenback which, in turn, makes it even harder for precious metals to appreciate in value. What we can take away from today as far as precious metals spot values are concerned, however, is that it is encouraging to see precious metals backtrack only slightly on a day when a multitude of factors were stacked against them. If tomorrow’s European Central Bank meeting goes as planned, most are feeling that this will be a positive sign for gold and silver. As for the metals outlook as a whole, continued uncertainty is helping keep both gold and silver in the good graces of investors who are looking to safeguard themselves from exactly this type of uncertain economic environment.
Wrap-Up
As we have been saying all week, tomorrow’s ECB meeting can definitely be described as top-billing. Beyond that, investors will also have the weekly jobless claims report from the United States to deal with. As has been the case for some time now, investors are very much concerned with the week-by-week and month-by-month performance of the US labor market.
