Mid-Day Gold & Silver Market Report – 8/22/2013
MAJOR BANKS FORECAST HIGHER GOLD PRICE BY YEAR END
Gold remains relatively flat today as low volume and lack of investor commitment ahead of the highly anticipated Fed stimulus tapering keeps Precious Metals trading in a tight range. The price plunge that saw Gold retreat to lows below $1,200 in late June has initiated a bevy of physical buying in India and China. Both nations traditionally represent the largest buyers of Gold jewelry, bars and coins, and the price retreat has further incentivized this demand among two investment cultures that view Gold as the conventional method of preserving wealth. Since reaching its low point, the Gold price has rallied 16 percent. Many economists and analysts are now predicting prices to rise through the end of the year as outflows of Gold-backed ETFs slow and strong physical demand endures. JPMorgan Chase & Co. and Bank of America have both increased their projections for Gold in 2013 with the latter forecasting an average price of $1,495 during the fourth quarter.
U.S. stocks are rising Thursday as the Dow Jones Industrial Average hopes to break out of its longest losing streak in over a year. After falling sharply again on Wednesday as reluctant investors weighed the Federal Reserve’s intentions regarding a reduction in quantitative easing, stocks are slightly improved today amid positive domestic and global economic reports. “The economy is not at this point looking like it’s going into a recession. It is certainly not booming, and that is the quandary the Fed has and why the taper is such a big deal,” Paul Nolte, managing director at Dearborn Partners, said. If and when the Fed will begin scaling back its asset purchase program remains the giant question mark for investors and traders who ponder the impact the move could have on equity and Precious Metals markets.
At 1 p.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,374.50, Up $2.20.
- Silver, $23.20, Up $0.16.
- Platinum, $1,538.50, Up $18.40.
- Palladium, $756.40, Up $8.00.
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