May 29th Silver Market Update

Gold and silver spot values fell for a third consecutive day this week as technical selling seems to have a firm grip on the marketplace. This week, though shortened by the holiday on Monday, has seen market bears take firm control of the marketplace. World stock indexes have recently been on the rise and have dealt metals a significant blow as an increasing amount of investing funds move away from safe-haven gold and silver and in the direction of more risk-laden assets.

The fact that the crisis in Ukraine is continuing to fade into the background as far as the investing world is concerned is not helping precious metals either. Up until very recently, the violence in Ukraine was keeping safe-haven demand for precious metals on the up and up. Now, with a new president, one that is dead-set on resolving the crisis, set to take office, most signs are pointing towards a peaceful resolution to any and all violence in the large Eastern European nation. Despite things in Ukraine calming down to an extent, we will continue to keep a close eye on any and all developments as the crisis is still very far from resolved at this point.

Downbeat GDP Report Does Not Help Metals

Early on Thursday, it was announced that the preliminary Gross Domestic Product for the US in the first quarter of this year fell by about 1%. This data was far short of market expectations and ended up stopping the decline of gold and silver spot values, at least temporarily. Before long, however, spot values were back on the decline and looking to end the day slightly worse than where they finished a day ago.

The marketplace was generally quieter today as most investors, especially those throughout Europe, are holding their positions until the conclusion of next week’s European Central Bank policy meeting. Currently, it is widely believed that the ECB is going to announce some sort of new monetary stimulus, a move that has been anticipated by investors for some time now. Normally, any type of monetary stimulus would be a good sign for the precious metals market. However, under current conditions, new monetary stimulus is likely to decrease the value of the euro currency, thus causing the US Dollar to gain more value. So long as the US Dollar is receiving a boost from potential European monetary stimulus, it will be difficult to make much of any gains.

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