February 19th Silver Market Update

Precious metals are adding value as of the writing of this post midday Thursday, mostly thanks to bargain-hunting after significant losses piled up earlier this week. On the whole, this week has not been too exciting and has been mostly devoid of markets-moving economic data. Of course, an exception to that rule was offered yesterday when the latest FOMC minutes were made public.

In other news this week, the market’s attention has been drawn to Europe for a few different reasons. For one, Greece’s new government is in talks with creditors about possibly altering their previously agreed upon deal with regard to debt reduction and austerity measures. Greece’s newly appointed government wants nothing to do with the 2012 deal, and has been actively trying to get out of it for some time now.

Not too far away from Greece, the market’s attention has also been drawn to a ceasefire agreement that is on the verge of collapse in Ukraine. Reached last week in Belarus, the ceasefire went into effect on Sunday and is, as of the writing of this post, all but collapsed. Up to this point, however, the fact that fighting has picked up once again in Ukraine has not caused much of a stir across the global marketplace.

FOMC Minutes Far More Dovish Than Expected

Like was previously stated, this week was never expected to be very busy from an economic data standpoint. Despite this, the latest FOMC minutes were made public on Wednesday and were greeted with much anticipation on the part of investors. Unfortunately, yesterday’s FOMC minutes release showed that the Fed is still quite hesitant to raise interest rates anytime soon. Citing the unstable price of oil, among a host of other factors, the Fed is clearly in no rush to change the interest rate situation in the United States.

Prior to the release of yesterday’s minutes and prior to the last few week’s worth of poor economic data from the United States, a large quantity of investors were convinced that interest rates would be on the rise sometime during this upcoming Summer. Now, however, most of us would be surprised to see interest rates in the US changed before 2016.

In other news, it seems as though Greece and its creditors have struck a deal that will see Greece be able to postpone certain austerity measures. This agreement sees Greece be rewarded with an immediate injection of cash to help solve a credit situation that may have forced Greece out of the EU. Of course, this week’s deal is not to be viewed as progress, but rather a postponement of problems that still exist and will resurface before long. For precious metals, the agreement reached in Greece hurt spot values thanks to the confidence in the European equity markets it created.

Posted in News

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