Gold and silver are riding a nice upward surge into the late afternoon as short-covering and safe-haven demand prompted the metals to reach their highest position in roughly 3/4s of a month. There still remains a lack of any fundamental inputs with regard to economic data, but some geopolitical events are beginning to make some noise on the periphery of the market’s attention.
Perhaps the biggest piece of economic data this week came today in the form of the weekly jobless claims, which were higher than expectations. Today’s retail sales report was also significantly weaker than market expectations, both these pieces of economic data worked to give gold and silver spot values a slight boost.
Violence On The Rise In Iraq, Fueling Safe Haven Demand
Safe-haven demand for precious metals is on the rise after it was reported that Kurdish rebels are taking over towns in the norhtern part of the country. The rebels are continuing to advance southwards and are, by the day, threatening larger expanses of territory in Iraq. As things continue to deteriorate in Iraq, the Iraqi government is calling upon the United States for military aid. At this juncture, however, it is not very likely that the US military will be seen providing the new Iraqi security forces with any help.
The wider outbreak of violence in Iraq is bringing safe-haven demand back to the market for the first time in more than three weeks. Spot values are on the rise, though there is no real way of telling if this rally will last through the last day of the week.
The US Dollar was also weaker today, and that provided gold and silver with a modest boost. US equities are continuing to cool off, though the market bears are still very much in control of the marketplace. Next week will hopefully bring about some more economic data, and will also hopefully give investors more insight into what exactly is going on in Iraq.