Posted on August 17, 2015
Gold Spot Price Open: $1,116
Gold Spot Price Close: $1,119
Change in Gold Spot Price: +$3
Silver Spot Price Open: $15.33
Silver Spot Price Close: $15.38
Change in Silver Spot Price: +$0.05
Precious metals opened the week positively by adding some value in the wake of a less than stellar US economic report. When all was said and done, gold managed to gain about three dollars while silver picked up closer to 5 cents. Platinum and palladium finished the first day of this week mixed, with platinum up by nearly ten dollars while palladium slipped by about 5.
As has been the case recently, economic reports big and small have proven that they are something investors the world over must pay attention to. That point was driven home again today when the Empire State manufacturing survey came back far, far weaker than anyone would have ever anticipated. A reading of +3.86 was recorded in July, and though that may mean nothing to you, it is a reading that suggests the manufacturing sector of the US economy is chugging along at a good tick. August’s reading, however, came back at nearly -15 and this much ended up confusing and surprising the market.
For gold and silver, safe-haven demand ticked up almost immediately as investors, who are taking note of the recently rocky bit of US economic data, pondered what this all could mean for the timing of interest rate hikes. While it is still generally agreed upon that rates will be risen within a month or so, recent economic data has some investors thinking otherwise. So long as the market is not wholly confident in the September hiking of rates, gold and silver may see some upside support. As we head deeper into this week, the eyes of the world, as they have been for some time, will be fixated on any and all economic data that is made public.
From an economic standpoint, there hasn’t been much in recent months to talk about as far as Japan is concerned. The Asian economy has more or less been stagnating and is just one of many Asian countries that is but a mere shadow of year’s past. According to a report released today, Japan’s economy fell even further during this year’s second quarter, shrinking by nearly 2%. Not only are Japanese consumers spending less, foreign consumers of Japanese goods are purchasing fewer and fewer items. Slumping exports took up a majority of the blame for today’s poor reading on Q2 GDP, but there are a host of other factors currently pinning Japan’s economy down.
Now, the call is for Japan’s government to stimulate the economy through any number of different tactics. The reason for this being that the current rate of growth, or lack thereof, is something that will not fix itself anytime soon, or so so many people believe. Though we have not paid too much attention to Japan over the past few months, I expect that to change as we head deeper into the year and as Japan continues to show signs of stagnation.
All in all, today offered a fairly slow start to what is shaping up to be an even slower week. There isn’t too much in the way of markets-moving economic data to discuss, but even smaller, less significant pieces of US economic data are being called into the spotlight, so we will keep an eye on all data releases. As we approach the end of August, expect speculation regarding interest rate hikes to only intensify with each passing week, especially now, in light of recent economic data points.