Economic numbers are strong
Precious metals rebounded last Thursday, the day after the Fed meeting ended. All four metals (gold, silver, platinum, and palladium) rose to 0.63%, 0.47%, 1.7%, and 3.1%, respectively. The rebound was likely due to the temporarily delayed fear of interest rate hikes.
A few crucial economic numbers came out on Thursday like the Philly Fed Manufacturing Index, which measures the level of a diffusion index based on a survey of manufacturers in Philadelphia. This leading indicator of economic health stood at two. Also, the unemployment claims were lower than the analyst expectations of 262,000. Positive numbers from the world’s biggest economy often negatively affect safe-haven assets, but the precious metals rebounded from the previous day’s loss.
A greater chance of another rate hike resulted in a drop in the net long positions in four of the last five weeks. Also, minor outflows from gold-backed funds limited the upside in the metal.
Members of the Federal Open Market Committee were upbeat about the US economy and labor market, but several mentioned that any slowdown in future hiring would not bode well for a near-term hike. Thus, precious metals rebounded.
The rebound in the metals helped most of the mining equities on Thursday. Among the top gainers on Thursday were Gold Fields (GFI), Cia De Minas Buenaventura (BVN), and Pan American Silver (PAAS). These three stocks rose 2.9%, 4.4%, and 3.5%, respectively.