Morning Gold/Silver Market Report The gold market was close to unchanged overnight after falling under pressure yesterday in the wake of better than expected economic data and a stay the course message from the FOMC meeting. A better than expected GDP number yesterday was taken as yet another indicator that the US economy is getting stronger, which lifted the Dollar and pulled support away from the metals. 2nd Quarter GDP growth came in at +4.0% annually versus +3.0% expected, while the 1st Quarter GDP was revised to -2.1% vs the previous estimate of -2.9%, which means that the US economy is on a much better track than what was thought. The FOMC meeting results offered little surprise. If anything, it was at the dovish end of expectations. The Fed decided to reduce their asset purchases to $25 billion per month, down from $35 million previously, which was about as expected. The Fed also stated that it will keep short-term interest rates low for a considerable time after the asset purchases conclude. Silver was higher overnight, and it has held up better than gold in the face of the stronger economic data. News that Argentina technically defaulted overnight have pressured the equity markets, but so far the metals dont appear to be affected. News that Euro-zone inflation readings have fallen to their lowest level since October 2009 is causing some concern about their economy, but it also means that the inflation threat is low, another negative to gold. Geopolitical tensions remain high, as Israeli leadership has vowed to continue its offensive until it closes all the arms tunnels from Gaza, despite severe criticism from the UN and even the US. More key economic data is on its way with US Weekly Jobless Claims Thursday and the monthly US Nonfarm Payrolls report on Friday. Another strong Non-Farm Payrolls report could send gold back to its recent lows. Despite the predominant weakness in gold, silver has managed to close slightly higher for the past two days, as the market apparently has less to lose from a strengthening economy and possibly a little bit to gain. Comex Gold Stocks were 8.652 million ounces down 193. Comex Silver Stocks were 176.758 million ounces up 1,196,909.
Posted on: Thu, 31 Jul 2014 12:05:06 +0000
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