Posted on August 27, 2015
Gold Spot Price Open: $1,127
Gold Spot Price Close: $1,126
Change in Gold Spot Price: -$1
Silver Spot Price Open: $14.18
Silver Spot Price Close: $14.50
Change in Silver Spot Price: +$0.32
Precious metals finished the day mixed as market conditions continue to push forward much like they have the past week or more. When all was said and done, gold lost about a dollar while silver managed to gain over 30 cents after yesterday’s losses of more than 50 cents. Platinum and palladium both finished upward, with platinum picking up more than 15 dollars while palladium managed to gain more than thirty.
The US Dollar and stocks managed to gain more of a footing as US Q2 GDP data was revised upward by considerable margins. This news could not have come at a better time either, because recent economic data has been missing the mark. Officially, the initial reading of Q2 growth of just more than 2% was revised upward and came back at up 3.7%. As far as GDP data is concerned, it is especially refreshing for investors to see today’s figures because it helps make up for GDP data from Q1 which indicated economic growth of barely more than one half of one percent. Granted, the poor GDP numbers can be explained by a particularly harsh Winter, but even still, the numbers were far from upbeat.
Now, with a refreshed outlook on the US economy, investors are once again flowing with confidence with regard to rate hikes. As it stands, most are still expecting to see interest rates risen by September’s FOMC meeting. Of course, between now and then anything can happen in order to alter this belief. Today, in fact, New York Fed president William Dudley commented on the likelihood of September rate hikes by saying that a September rate increase “seems less compelling” than it was at the beginning of August.
After monumental losses over the past two weeks, stock indexes in the US seem to finally have been given the boost they need to make gains once more. Today’s GDP data reinvigorated the marketplace and the confidence of investors all at the same time. With September rate hikes slowly but surely being counted out, investors are being quick to act. With the US economy likely not going to see any changes for at least another month, investors have grown confident in certain short positions.
What’s more, markets in Asia seem to have settled down a bit, which is another good sign for US stocks. If crude oil can continue today’s rally and close out the week on a positive note, things might be looking up as we head into the month of September next week. Markets in the US are still a good bit away from reaching all-time peaks recorded a few months ago, but today’s upbeat performance shows us that the US economy is, in fact, quite resilient. Still, with turmoil lurking just beneath the surface in Asia and elsewhere around the world, serious questions with regard to the viability of September rate hikes are beginning to surface.
As we look ahead to the last day of the week, it will be interesting to see where stocks head after today’s gains. If US markets are on the up and up once more, I imagine gold and silver will finish the week more modestly than they would have otherwise. If markets tick back downward, however, it is my opinion that gold and silver may have some opportunity to post gains. We will just have to stay tuned and see what happens though, because current market conditions are quite unpredictable.