All Eyes on Inflation—And Gold and Mining Stock Movements
Much of the discussion surrounding another interest rate hike in December has been about how inflation numbers have remained low.
During the FOMC (Federal Open Market Committee) meeting in September, many officials showed interest in another rate hike in 2017—and more in 2018.
The last few days have seen a rise in precious metal prices. However, on Wednesday, October 11, 2017, the prices of these loved metals fell.
Gold reached its two-week high price of $1,294.5 an ounce on Tuesday, October 10, and ended the day at $1292.1 per ounce.
According to the employment data that came out last week, US employment fell in September for the first time in about seven years.
All the four precious metals saw an up day on Monday, October 9, 2017.
Gold rose on Wednesday, October 4, 2017, after having touched its seven-week low price of $1,269.2 an ounce.
Precious metals had a slow day on Tuesday, October 3, 2017. They traded almost flat, falling only minimally and maintaining the downward sentiment.
On Monday, October 2, the SPX Index, depicted by the SPDR S&P 500 ETF (SPY), rose 0.42% on Monday and ended at $252.30.
China, along with the rest of the world, has experienced a long-running decline in productivity growth—a decline that accelerated after the Global Financial Crisis.
According to the data by the Commodity Futures Trading Commission on September 29, large speculators have cut their bullish net positions in gold futures.
Equities and safe-havens like gold are historically known to move in opposite directions because gold is often seen as a hedge against overall market risk.
The negative sentiment toward gold prevailed on Friday, September 29, the last trading day of the month. Gold futures for November expiration fell 0.3%.
The latest US GDP stood at 3.1%, which was just higher than the analyst expectation of 3%.
Gold touched a one-month low on Thursday, September 28, due to the rise of the US dollar over the speculation of another rate hike in December 2017.
Like the US dollar, global tensions can be responsible for precious metal price fluctuations. North Korea has interpreted US president Donald Trump’s comments as a declaration of war, stating that Pyongyang has…
Between the top two precious metals—gold and silver—silver is known to be more volatile.
Rising tensions in North Korea, heightened political uncertainty in Washington, and policy changes by the Fed have all moved precious metals in August and September.
Like silver, platinum has industrial uses and has seen growing demand in China.
Besides geopolitical issues, the US dollar has also been playing an important role in the determination of the price movement for precious metals.