Gold Spot Price Open: $1,374
Gold Spot Price Close: $1,281
Change in Gold Spot Price:-$93
Silver Spot Price Open: $21.75
Silver Spot Price Close: $19.69
Change in Silver Spot Price:-$2.06
Gold and silver posted dramatic losses on Thursday, as both metals hit historic lows. It wasn’t only precious metals that were suffering today as stock markets fared badly as well. At the end of the day gold was down over 90 dollars while silver’s losses eclipsed two dollars.
In the immediate aftermath of the Federal Open Market Committee meeting yesterday, precious metals did little moving, though the only moving they did was negative. The overnight and early morning hours on Thursday spelled a different story for precious metals, however, as both lost significant value before US markets even opened. Things only got worse as the day went on as gold came very close to losing over $100 in one single day.
The reason behind why gold and silver are dropping so dramatically is not so much the FOMC meeting, but more what happened afterwards. The meeting itself yielded no changes to monetary policy in the United States, though Ben Bernanke’s press conference afterwards hinted that the Fed’s bond buying may be slowed down in the coming weeks and months. In fact, many market watchers and experts think that in a year’s time, monthly bond-buying by the Federal Reserve will be nothing more than a thing of the past. That is a bold speculation, but not one that should be written off completely.
In addition to precious metals taking huge hits, stock markets across Europe, Asia, and North America also declined by considerable margins. While European and Asian stocks have been doing badly lately, the US stock market has been on a good run of form and today will hinder that forward progress considerably. Expect some fresh bargain-hunting demand to be in effect today and tomorrow, but with risk aversion running rampant it is still unsure whether an increase in demand will be enough to correct any of the losses we have seen today.
Finally, the US Dollar made considerable gains, though this is expected as stock markets and commodities tumbled.
