Posted on April 11, 2017
Gold Spot Price Open: $1,256
Gold Spot Price Close: $1,277
Change in Gold Spot Price: +$21
Silver Spot Price Open: $18.03
Silver Spot Price Close: $18.31
Change in Silver Spot Price: +$0.28
Precious metals bounced back on Tuesday as geopolitical jitters have begun to set in amongst global investors. When all was said and done, gold ended up tacking on about 21 dollars, while silver added almost 30 cents. Platinum and palladium were both up for most of the day, but fell and ended the day right near even.
While we mentioned yesterday that recent geopolitical developments have not been having too much of an impact on the precious metals market, perhaps we spoke too soon. After metals mostly spun their wheels to begin the week, traders are now buying the recent price dip. Helping make the decision to buy for most investors is the fact that so many different geopolitical happenings are beginning to unfold.
While worries with regard to further US involvement in the Syrian civil war are not exactly as high as they were last week, they are assuredly still lingering. Add to this the fact that the US is participating in military drills with South Korea off the coast of the Korean Peninsula, and you have a few concerning talking points. Just this morning, North Korea issued another barrage of threats for the United States’ increased military presence in the region. All in all, these activities are doing well to provide metals with some underlying support. So, while none of these events are going to be enough to fully propel metals forward for an extended period of time, they are going to be useful to spot values at least through the near-term.
Added to all of this is the impending French presidential elections. As we have mentioned before, there still remains a fear that a right-wing candidate—who has intentions of abandoning the EU—will emerge victorious in France in much the same way that Donald Trump was victorious in the US. At this particular juncture, a right-wing candidate is not favored to win, however no one is forgetting that we were saying the exact same thing about Donald Trump back in September and October of last year. All things considered, it will be interesting to see how things pan out in France.
The USD, which had performed well against a basket of rival currencies for the better part of last week, pulled back to some extent on Tuesday. Monday saw the greenback get things off to a flying start, as the currency quickly surged to a 4-week high. Since then, safe-haven demand for metals along with investors cashing in on recent gains has pushed the USD Index back downward.
So long as these tensions run rampant across both the US and global marketplaces, it seems as though it will be tough for the Dollar to move too far forward. With that being said, a strong batch of Q1 2017 economic data could potentially be enough to turn the Dollar’s progress around.
It seems as though much of the world has already checked out for the Easter holiday, as things were generally quieter on Tuesday. I would expect much of the same as the week wears on and as the trading atmosphere grows increasingly quiet. Naturally, we and the rest of the world are going to keep our eyes on the aforementioned geopolitical happenings, as they are currently some of the main driving forces behind global investing activity.