Gold Spot Price Open: $1,184
Gold Spot Price Close: $1,178
Change in Gold Spot Price: -$6
Silver Spot Price Open: $16.53
Silver Spot Price Close: $16.23
Change in Silver Spot Price: -$0.30
Precious metals continued to depreciate Thursday as market factors continue to stack up against both gold and silver. When all was said and done, gold lost about 6 dollars while silver yet again lost more than 25 cents. Platinum and palladium also finished down on the day, by about 5 dollars apiece.
Non-Farm Payrolls Will Have to Miss to Aid Metals
Undeniably, the biggest focus of the week up to this point has been Friday’s non-farm payrolls report for the month of May. Expected to be released sometime tomorrow afternoon, the employment report from the month of May is arguably the biggest data point of the month.
As it stands, the market and polled experts are anticipating to see that May saw more than 225,000 new jobs added to the economy. Even though Wednesday’s ADP report showed only about 200,000 private-sector jobs added to the economy, hopes are still on the up and up for Friday’s report.
For gold and silver, the only way tomorrow’s employment report will boost spot values is if it misses majorly. A small miss will likely not have that much of an impact, but if we see that less than 200,000 new jobs were added to the economy you can believe that investors will be effectively taken aback. Even if tomorrow’s employment report misses by a large margin, most experts agree that it will take much more than one bad jobs report for gold and silver to receive any sort of lasting boost.
IMF Cuts US Growth Forecast
Despite it being widely believed by many that interest rate hikes will be taking place before the end of 2016, the International Monetary Fund, which today downgraded their outlook for US growth this year, made it clear that they think the Fed should hold off on interest rate hikes. In the same breath, the IMF statement went on to describe recent US economic stagnation as being “temporary” in nature.
According to the IMF, “The U.S. economy’s momentum in the first quarter was derailed by unfavorable weather, a sharp contraction in oil sector investment, the West Coast port strike and the effects of the stronger dollar. These developments represent a temporary drag but not a long-lasting brake on growth. A solid labor market, accommodative financial conditions and cheaper oil should support a more dynamic path for the remainder of the year.”
Basically, the IMF is a firm believer that the US should approach interest rate hikes with caution. Now that we are approaching the latter six months of the year, focus on US economic data will tick up considerably. This will be especially true if economic data continues upon its improved path.
Wrap-Up
This week has been eventful, there is no denying that, but tomorrow is set to be the most action-packed day of the week. For one, tomorrow marks a roughly $325 million debt repayment scheduled to be made by Greece to the International Monetary Fund. As it stands, it is widely believed that Greece will not be able to make tomorrow’s loan repayment and may very well be forced to exit the European Union. There is still hope for some sort of last-minute agreement to be reached.
What’s more, the US employment report for May is due out by the early afternoon. Considered to be one of the most important pieces of data going forward, the US employment report tomorrow will be but one more piece added to the interest rate hike speculation puzzle.
