Both gold and silver had strong weeks, as physical supply issues as well as positive economic news drove both metals significantly higher. After last week’s relatively stagnant market, we finally had some news come out to drive some action in the precious metals spot markets. Below we’ll recap each day’s trading and explain what drove all of the price movements.
Strong Open on Monday
Gold and silver both opened well up on Monday morning in the domestic markets, as the US Dollar lost ground overnight to a basket of other currencies, and especially to the Euro, as the ECB announced interest rates would remain unchanged for the time being. When the dollar loses value, gold and silver inherently rise, as both metals are priced worldwide in USD. After the opening bump, silver sat at $31.09, up $0.65, while gold rose $10.60 to $1,673.20.
Both metals were able to hold their gains throughout the day, as renewed questions surrounding the debt ceiling provided support at $31 and $1,670. Further gains were had Tuesday, despite not much news in the global markets.
Supply Issues Drive Demand
On Thursday the US Mint, the producer of the wildly popular American Silver Eagles, announced that they had officially “sold out” of the 2013 version of the coin, and would not be taking any new orders until January 28th at the earliest. When the coins are back on sale, they will be offered on an allocation basis to the limited pool of Authorized Purchasers.
Both gold and silver increased on this news, and retail premiums for both Silver Eagles and Silver Maple Leafs increased sharply, despite the fact that Maple Leaf supply is still good for the time being. Junk silver (90% especially) also saw premiums increase in the retail segment of the market.
Overall, silver moved from $31.15 Monday morning to $31.94 at the Friday close, while gold opened at $1,671.40 Monday, and closed Friday at $1,691. A solid week for both metals.
This market update is provided weekly with analysis. You can always check current silver prices by watching our on-site charts.