Posted on July 27, 2015
Gold Spot Price Open: $1,099
Gold Spot Price Close: $1,097
Change in Gold Spot Price: -$2
Silver Spot Price Open: $14.75
Silver Spot Price Close: $14.63
Change in Silver Spot Price: -$0.12
Precious metals stabilized a bit on Monday after a few weeks’ worth of losses. Safe-haven demand for gold and silver ticked upward a bit, but it did more in the way of limiting losses than anything else. When all was said and done, gold stayed in about the same position it was in when the day began while silver lost over ten cents. Platinum and palladium both lost value, but neither metal lost more than ten dollars.
Against a basket of currencies, the US Dollar is hovering near a two-week low. Demand for other currencies helped keep the Dollar subdued today, as investors feel that, to some extent, the Dollar is too volatile for their liking for now. In Europe, strong economic data from Germany gave the euro a boost. All in all, the outlook on the Dollar is still upbeat, especially as interest rate hikes are expected to be coming sometime in the near future.
Chinese stocks continue to slide, and while it may be difficult to comprehend, this is doing the US economy no favors. A big theme across the global marketplace is the fact that traders who have been negatively affected by this recent Chinese economic slide are recovering losses by closing short bets against the euro. This move is pushing the euro higher which almost always translates into a bad day for the greenback.
After months of poor performances, orders for durable goods from the US rose during the month of June. Officially, orders for durable goods rose by just shy of 3.5% on an annualized basis. This is the first such increase since the early parts of the Spring, and is but one more factor working in favor of gold and silver spot values.
Now, investors the world over are looking ahead to the GDP data release scheduled for later this week. Being that all eyes have been on the US economy for some time now, this most recent batch of GDP data is especially important. Should the data come back upbeat, it is my opinion that gold and silver spot values will suffer even more than they have over the last few weeks. Despite today’s safe-haven demand stemming from worries regarding the stability of China’s economy, metals have received very little support from the global marketplace. Barring an overly downbeat batch of data this week, I expect that the metals market will remain pinned down.
There will be plenty of other economic data released this week, but I am anticipating that mostly all of it will be overshadowed by GDP data. The US economy is currently hitting on all cylinders and has been for most of the slow parts of the summer. As we are all aware, this has been bad for gold, but even more depressing for some investors is the fact that things are not looking like they will change anytime soon.
Looking ahead, this week is going to see investors almost solely focus on the GDP data release. This is something that is going to, in the eyes of investors, affect the timing and extent of interest rate hikes. A bright spot that can be taken away from today and the weekend is the fact that gold’s spot value is once again approaching the $1,100 mark.