Precious metals did not perform as well this week as they have over the course of the past month or more. To be fair, this 5-day trading session was more lackluster than anything else, dominated by pieces of economic data that are, quite honestly, not deemed overly important by investors. In addition, there was some developments with regard to the post-BRExit world and what the future holds for those concerned.
Despite this week mostly being a losing one for gold and silver, the fact of the matter is that losses very well could have been larger. Thanks to crude oil and the USD lagging a bit, gold, silver, and other precious metals were able to sustain their positions to some extent.
US Economic Data Dealt, Interest Rate Hikes Discussed
There were quite a few pieces of US economic data dealt this week, but for the most part they flew under the radar and were not necessarily hawked over by investors all that much. One of the more noteworthy pieces of economic data dealt came in the form of the producer price index for June, which showed an increase in prices that was larger than expected. Despite most economists calling for prices to rise by roughly .3% during June, the actual figures showed an increase of .5%. This news helped give stock markets in the US a boost, although they really didn’t need it.
Throughout the whole of this week, equity markets in the US and around the world were able to calm down a little bit and settle. In the US, equities were on a tear and managed to make nice gains day in and day out. The performance of US equities did not bode well for gold and silver and quite honestly stacked on the pressure.
In other US economic-related news, it was reported this week that weekly jobless claims remained even from last week to this week. Considering expectations were for the seasonally-adjusted average to tick upward by a decent margin, investors were satisfied. What’s more, the four-week moving average of jobless claims was down by almost 6,000. The 4-week moving average is often considered to be the most accurate and up to date view of the employment market, so this was some more good news from the US economic data front.
Finally, there was some talk regarding what, if anything, will happen to interest rates in the US by the time the year is through. The head of the Philadelphia Reserve was quoted this week as saying that we may see 2 additional rate hikes before the year is through. Most, however, feel as though this is a bit ambitious considering the state of the global economy. If you ask around now, you will find that most investors are anticipating just one more rate hike, and some have their doubts with regard to whether even this will happen or not.
The week’s final piece of noteworthy news came in the form of inaction on the part of the Bank of England. Having held their monthly policy meeting during the middle of the week, the final result was that the BoE was not going to make any changes to policy. With the UK swearing in a new PM, things have calmed down and investors are not now on edge as they were only 2 weeks ago. With that being said, however, the BRExit decision is still fresh on the minds of investors and is continuing to fuel, to some extent, the safe-haven demand that is still hanging around. As such, the gold and silver bulls are still in control of things and bossing the marketplace.