How Are Fund Flows to Precious Metal Funds Trending?
Precious metals have been tumbling due to expectations that the Fed could hike interest rates this month.
As the Federal Reserve gets set to meet next week, precious metals have been under immense pressure.
The fall in the price of gold on Monday, December 5, 2016, was partly determined by changes in the US dollar.
Silver prices have fallen in the past week. On Thursday, silver touched close to a six-month low after the minutes of the FOMC meeting were released.
Many of the fluctuations in precious metals have been a result of speculation about the Federal Reserve’s interest rate stance.
All eyes are set on the highly anticipated meeting of the Federal Open Market Committee on December 13–14, 2016, and the probable hike in interest rates.
Analysts believe the fluctuation in gold can be tracked through the OPEC meetings. If they lead to higher oil prices, there could be inflationary pressure across global economies.
The telecom sector fell 0.31% on November 29. Vonage Holdings (VG) (+2.6%) and NetGear (NTGR) (+2.2%) are the top performers.
Gold prices once again retreated on Friday, November 25, by $10.3 to close at $1,179 an ounce—the lowest level that gold has seen since February.
As precious metals have steadily fallen for the past few weeks, investors have been trying to read the increase in Treasury yields during the same period.
The US dollar rose ten consecutive days until November 18, 2016. However, it slowly weakened after that.
Gold has fallen more than $120 from its peak on November 9, 2016, following the US elections. The fall suggests optimism for a potential interest rate hike.
Investors’ eyes are now glued to a number of economic phenomena that could significantly change the direction in which precious metals flow.
Gold rebounded on Friday, November 25, 2016, during early trading hours. Its bounce back was most likely due to the halt in the dollar’s rally.
Explores oil and natural gas
India’s retail demand for gold was subdued due to a cash crunch following the government’s demonetization move.
After Donald Trump won the US presidential election on November 8, gold initially climbed above $1,300 per ounce. Shortly after that, it was back its original trading range and fell even lower after that.
Soros Fund Management recently dissolved its shares in the world’s largest gold ETF in 3Q16. According to its SEC filing on November 21, Soros Fund Management gave up on its gold-based holdings before the US presidential election in early November.
Goldman Sachs expects WTI crude oil price to be $55 per barrel in 1Q17 and 2Q17. These estimates were raised from $45 and $50 per barrel, respectively.
The US dollar witnessed ten consecutive days of rises until November 18, 2016. The US dollar Index closed at 101.2 on the day.