Closing Gold & Silver Market Report – 5/22/2013
UNEVEN FED REMARKS LEAD TO CHOPPY GOLD SESSION
The Gold price has settled lower again following a day of turbulent price action on the heels of Federal Reserve Chairman Ben Bernanke addressing the future of quantitative easing (QE). Gold experienced a sudden jolt upward during the first part of Bernanke’s speech warning against premature slowing of asset purchases. The latter part of Bernanke’s discourse indicated the Fed might be ready to rein in stimulus measures after the next few meetings. Though QE has recently been the most important motivator of Precious Metals prices, a pullback in the scale of monetary easing is expected to weigh heavily on Gold and Silver. “My sense is that Bernanke will look at U.S. consumer spending, U.S. business spending and U.S. hiring till the end of summer season and then take a call on QE,” said Chintan Karnani, an independent bullion analyst in New Delhi. However, many analysts have pointed to decelerating U.S. economic expansion as a factor that could impede the Fed’s enthusiasm for bringing an end to QE.
Along with Gold, equities markets are down following the release of the Federal Open Market Committee (FOMC) meeting minutes. Concern of a forthcoming scale down of the Fed’s bond-purchase package dampened market sentiment that has responded so favorably to the program. “The key takeaway is whether the Fed does more or does less all depends on the data,” said John Canally, investment strategist at Boston-based LPL Financial Corp. “Stocks have been up so much year to date. Largely, people are looking for an excuse to sell.” Investors will be closely eyeing the next FOMC meeting for further news of the future of QE.
At 6:00 pm (EDT), the APMEX precious metals spot prices were:
- Gold, $1369.90, Down $0.50.
- Silver, $22.26, Down $0.32.
- Platinum, $1464.10, Down $6.60.
- Palladium, $746.80, Down $7.40.
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