Gold and silver stable on Tuesday, July 26
After declining on Monday, July 25, and starting the week on a weaker note, gold and silver gained stability on July 26. At 2:20 PM EDT on July 26, the COMEX gold futures contract for December delivery was trading at $1,328.50 per ounce, a gain of ~0.1%. Silver was trading at ~$19.69 per ounce, a gain of ~0.21%.
Federal Reserve meeting in focus
The Market’s focus has turned to the two-day Federal Reserve meeting, which ends on Wednesday, July 26. Although no change in the interest rates is expected by the Market in this month’s Fed meeting, the market participants are looking forward to the FOMC statement to understand the Fed’s view on the global economy. The official FOMC meeting statement was scheduled to be released at 2:00 PM EDT on Wednesday, July 26.
The recently released better-than-expected US economic data increased the chances of an interest rate hike in 2016, which could be discussed in September. Currently, the probability of an interest rate hike by the Fed in September 2016 stands at 20%. The interest rate hike probability by the end of the year is 48%.
The increase in the interest rates could dent the sentiment in the gold market. Please read Why Gold Is Closely Tied to Interest Rates to learn why interest rates impact gold prices.
On Tuesday, July 26, the precious metal miners gained because of stability in the precious metal prices. Precious metal producers Barrick Gold (ABX), Newmont Mining (NEM), Silver Wheaton (SLW), and Royal Gold (RGLD) gained ~3.0%, ~2.0%, ~1.5%, and ~3.2%, respectively. The SPDR Gold Trust ETF (GLD) gained ~0.42%.
The final article in this series explains the performance of companies in the metals and mining sector on Tuesday, July 26.