October 30th Silver Market Update

The past day and a half or so have been extremely awful for the spot values of precious metals. While yesterday saw the most recent FOMC meeting wrap up, today played host to a good amount of economic data, most of which pressured the precious metals market. While only a day ago it seemed as though precious metals might be able to salvage the week, now it is looking like we are going to be hoping for damage control more than anything else.

As a result of today’s data, equity markets in the US are trending significantly higher while the USD Index is backing down from high points reached earlier this morning. Prior to yesterday afternoon we saw a good bit of economic activity, but for the most part, it had little to no impact on the global marketplace as most investors were waiting to hear from the FOMC.

FOMC Relays Positive Outlook on the US Economy

Kicking off on Tuesday and wrapping up yesterday afternoon, the latest FOMC was met with the usual attention they receive whenever they convene for a meeting. As has been the case for the past few months now, investors and analysts were hoping to hear the Fed shed some more light on the future of interest rates in the United States. As expected, in the FOMC’s post-meeting statement, the Fed reiterated that it will still be a “considerable” amount of time until interest rates in the United States are raised.

While that language did little to surprise the market, what did surprise investors was that the statement went on to speak highly of the US economy’s progress; something that rarely happens in statements from the Fed. Though we all know that the economic atmosphere in the US is improving, it means a lot to investors to hear the Fed agree. While this didn’t really shed all that much light on the future of interest rates in the US, it definitely caused some investors to think that rate hikes might be coming as early as next February or thereabouts.

US Q3 GDP Beats Expectations

Only a day after the Fed sung the US economy’s praises, it was announced that the United States’ third-quarter GDP came back far better than expected. With the US economy growing at a faster rate than expected during the third-quarter of this year, that caps off the US economy’s best 6-month run in over a decade.

Complementing the GDP data was a separate report claiming that fewer Americans filed for unemployment during October than at any other point in time in the last 14 years. As you might have guessed, all of this data weighed heavily on precious metals and is a major part of the reason silver has lost nearly $1/ounce today while gold is down by almost $25/ounce.

Posted in News

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