For a second consecutive week, both gold and silver managed to finish the week in a better position than where they began it. For the most part, a lack of fundamentally bearish inputs in conjunction with a stronger risk-averse sentiment on the part of investors has ended up coming to the aid of metals. To be fair, there really haven’t been too many fresh pieces of economic data dealt this week. As such, we saw, for most of the week, investors focus on last week’s FOMC decision to hike interest rates.
To provide some background, investors cannot get past the FOMC meeting because of the lack of hawkish commentary. In the lead-up to last week’s meeting, not only did investors anticipate the rate hike, they also anticipated that the FOMC would be more direct with regard to their intentions to raise rates further down the road, before the year comes to a conclusion.
One of the major focal points of the week came on Thursday in the form of a vote that would not only abolish the Affordable Care Act (better known as Obamacare), it would also jumpstart the process that would see a Republican version of the same bill taken into consideration. Though the vote was to take place on Thursday, it was put on hold until Friday due to the Republican majority in the House not being able to garner enough support. As of late in the afternoon on Thursday, there flat-out was not enough support for the bill, and a vote would have seen the rejection of Obamacare denied.
For gold and silver, this is good news because this is a story that has been pushing the Dollar steadily downward. With President Trump looking more and more like he is incapable of affecting change, the Dollar is struggling. In all, there are a vast quantity of doubts with regard to whether President Trump can actually institute the change he has promised, or if he and his staff will continue spinning their wheels, so to speak.
While last week was full of fresh pieces of economic data, this week brought about the opposite. To be completely honest, there were almost no new pieces of economic data dealt throughout the week. As such, we saw stocks in the US move slightly upward while the Dollar trended noticeably downward. For gold and silver, this proved to be a great thing as spot values jumped up to multi-week highs. Whether this will continue into next week or not, however, that much remains to be seen.
Another major news story of the week came earlier in the week from London. According to news sources, a crazed man drove an SUV on a sidewalk, striking pedestrians and killing 3. This is just the latest of many terror attacks that have already taken place this year. Normally, you would anticipate that such an event would drive safe-haven demand and push spot values higher, but the events were mostly ignored by the global marketplace. You see, in today’s world, terrorist attacks like this one are seen as a common occurrence and are no longer really treated as a surprise by investors. As such, you will notice that safe-haven demand does not really uptick in the wake of such attacks.
Others were arrested for supposedly having similar terror plots in the works, but yet again these actions were mostly ignored by investors.