Posted on July 28, 2015
Gold Spot Price Open: $1,099
Gold Spot Price Close: $1,098
Change in Gold Spot Price: -$1
Silver Spot Price Open: $14.73
Silver Spot Price Close: $14.75
Change in Silver Spot Price: +$0.02
Precious metals, by the time the day was through, did not move too far in any single direction as investors await a prepared statement by the FOMC and a bit of economic data. When all was said and done, gold lost about a single dollar while silver managed to gain a few pennies. Platinum and palladium bounced back a bit, but gains were nothing to write home about.
Perhaps the US economy may not have much room for improvement. Though this is a fairly large statement to make after the last few months’ worth of upbeat economic data, today’s report on July consumer confidence has some investors thinking that this recent run is about as good as it gets as far as the US economy is concerned. Officially, consumer confidence in July sunk to its lowest level in more than four years as investors grow increasingly concerned about their financial futures. Negatively affecting US consumer confidence, as strange as this may seem, are factors that took place mostly outside the US. Things like the Greek debt crisis and massive, unprecedented swings on the part of Chinese equities, and other factors all shook the confidence of the average US consumer.
All in all, today’s report on July consumer confidence was a big surprise and kind of against the run of things, as most recent US economic data has been far and away better than expectations. I do not want to speak too soon, but if this reading on consumer confidence is any indication of the direction we may be headed in as the Fall approaches, gold and silver spot values may have some room to move forward after all.
While this week’s round of GDP data from the US is being awaited by investors everywhere, we will first have to weather the storm that is the conclusion of the latest FOMC meeting. Kicking off today and expected to wrap up tomorrow afternoon, this meeting is being seen by investors as the one that will provide a solid, succinct conclusion on interest rate hikes. The market is now more or less 100% convinced that interest rate hikes will take place this Fall, with many investors pointing to September’s FOMC meeting as the time when we will hear interest rate hikes be announced.
With some luck, this week’s meeting will shed further light on the interest rate situation, but I for one am not holding my breath on the matter. The Fed loves being cryptic in their language, and I would expect that Janet Yellen will hold her hand close to her come speaking time tomorrow. If, however, she at all alludes to September or any other month as a definite time when interest rate hikes will take place, I think we may see some more downside pressure facing gold and silver. It may be preliminary, but you can bet that the market’s attention will be firmly fixated on the Fed come tomorrow afternoon.
As is plain to see after analyzing the movement of spot values today, metals still have very little momentum. On days where many things are going on, it seems as though all factors are stacked against metals, while on quiet days it seems like technical selling dominates proceedings. Tomorrow is looking like it will be a big day for gold and silver, but if anything it will be a big day for all the wrong reasons. All in all, it is looking like we are going to see another week of losses for gold and silver, which is quite a statement to make for it only being Tuesday, but also one I am fairly confident in.