Morning Gold & Silver Market Report – 1/30/2013

GDP DATA SHOCKS MARKETS; ECONOMY SLOWING

Precious Metals prices received an unexpected boost this morning, as the fourth quarter gross domestic product (GDP) release shocked the markets. Expectations across the board were that GDP would show slow growth for the economy, but now analysts are thinking that additional monetary stimulus may be needed as the drop was much more than expected. Some are speculating that payroll tax increases that went into effect January 1 could have an even worse impact on first-quarter GDP. Whereas investors seemed to be waiting for news out of the Federal Reserve meeting prior to the release of this data, it appears that sentiment has changed.

A statement is expected from the Fed today at the conclusion of a two day meeting. Many already expected a continuation of last year’s bond buying program, and the GDP data reinforces that. Standard Chartered analyst Dan Smith said, “The Fed’s decision and statement are something people are looking at quite closely. The big challenge for Gold is the impact a world economy recovery will have on prices.”

At 9 a.m. (EST), the APMEX Precious Metals spot prices were:

• Gold, $1,680.30, Up $17.50.
• Silver, $31.87, Up $0.65.
• Platinum, $1,689.30, Up $10.40.
• Palladium, $758.00, Up $7.30.

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