Gold Spot Price Open: $1,208
Gold Spot Price Close: $1,218
Change in Gold Spot Price: +$10
Silver Spot Price Open: $16.06
Silver Spot Price Close: $15.96
Change in Silver Spot Price: -$0.10
Gold and silver seem to be benefiting from a slow start to the week as well as some questionable US economic data. When all was said and done on Tuesday, gold managed to pick up about 10 dollars while silver saw gains somewhere in the neighborhood of 10 cents. Platinum and palladium finished the day mixed, but neither metal finished too far from where it began the day.
Mixed Bag of US Economic Data Dealt
Tuesday wasn’t exactly a huge day of economic data, but with recent commentary from the Fed and June’s FOMC meeting inching ever-nearer, every bit of economic data from the US will be watched over carefully by the marketplace. All in all, today’s data was mixed, but this did little in the way of derailing the overriding belief that interest rates will, in fact, be raised before month’s end.
First up was a report from the US Commerce Department which said that US consumer spending was up by little more than 1% in April. According to the data, spending on cars and other durable goods was up by much more than expected. In addition to this, wages and salaries were reported as jumping forward in April as well, which is always going to be a good bit of strong underlying data to complement recently upbeat reports with regard to job growth.
In more downbeat news, it was reported today that US consumer confidence fell in May. Officially, May’s reading on consumer confidence came in at 92.6, which is down from April’s reading of more than 94. Lynn Franco, who is a top official at the Conference Board, which produces the readings on consumer confidence, spoke on today’s data by saying, “Consumer confidence declined slightly in May, primarily due to consumers rating current conditions less favorably than in April. Expectations declined further, as consumers remain cautious about the outlook for business and labor market conditions. Thus, they continue to expect little change in economic activity in the months ahead.” This is good news for those that want to see rate hikes during June and is one more piece of evidence that supports the likelihood that rates will be risen before long.
OPEC Meets Again
Over the last few weeks we have seen the price of oil appreciate to some degree, but the gains that have been made are not anywhere near enough to undo the mass accumulation of losses that made up much of the first part of 2016.
As it stands, the spot value of a barrel of crude oil is hovering right around the $50 threshold, and this is good news for the marketplace. Unfortunately, the future outlook for crude oil is not so bright. Another OPEC meeting occurred over this past weekend and, yet again, no production cuts have come as a result of this. Fearing that the factors currently restricting the global production of crude oil will soon fade into irrelevancy, the spot price of crude oil may be beaten down once again. This does not lend support to gold and silver, both of which have been struggling to gain any foothold since the Federal Reserve minutes alluded that interest rate hikes are just on the horizon.
Wrap-Up
All in all, Tuesday offered up quite a bit of data for it being the start of a slow week. As we move forward, you can expect that the rate hike talk will continue through this week, the next week, and forever until a decision to hike rates or keep them put is finally made. For gold and silver, the prospect of this is not a very good one. With some luck, however, metals will not fall too much further than they have already.
