Precious metals are trending lower during the first half of the day Thursday, fueled by reaction from yesterday’s FOMC meeting. This week is just beginning to pick up from an economic standpoint, and will likely get even busier as the last day and a half plays out. Precious metals are continuing along their downward trend and are looking weaker today than during any other day this week.
Though many investors are still picking apart and analyzing the FOMC meeting, a lot of attention is shifting towards today’s Scottish referendum vote. The vote, which will determine whether Scotland becomes independent or remains part of the UK, is currently taking place, but it is highly likely that we won’t hear much in the way of results until sometime tomorrow or this weekend. Though it may seem hard to believe simply because Scotland is such a small country, this vote is shaping up to have a somewhat noticeable impact on the UK and European economies.
FOMC Remarks Deemed Slightly Hawkish
The Federal Open Market Committee of the United States held their monthly policy meeting this week, and as per usual, it attracted the attention of investors from around the world. The reason for this is due to the simple fact that there exists a prevailing belief that the United States will raise its key interest rate sometime in the (near) future. As such, investors were hoping that remarks by Janet Yellen or other members of the Fed might provide some insight with regard to when and by how much interest rates would be raised.
Unfortunately, yesterday’s meeting did not end up giving investors what they were looking for. Instead, the language utilized by the Fed was consistent with that which they have been using for the past few months or so. Though they increased their positive outlook on the US economy, they still held that there is still room for improvement before major policy changes would be enacted. The language officially used by the FOMC said that there is still “considerable time” until the Fed raises interest rates.
After hearing that, you may be wondering how on earth this week’s meeting was deemed hawkish by the marketplace. Well, to answer that question, look no further than the two FOMC members who dissented against the Fed’s opinions yesterday. Their dissenting translates into the marketplace thinking there are members of the Fed who want to see interest rates raised sooner rather than later. Whether this is true or not remains to be seen, but precious metals have not been given any support from this week’s FOMC meeting and statement.