Mid-Day Gold & Silver Market Report – 9/16/2013
FED CHAIRMAN RACE NARROWED, SEEN AS POSITIVE FOR GOLD
The U.S. dollar plummeted after this morning’s news that former Treasury Secretary Larry Summers was out of consideration for the new U.S. Federal Reserve chief job. The Gold price, which was hit immediately after the news, is lower than its high though still positive on the day. Newsletter editor Gene Arensberg said, “The market now sees continuity for the Fed as a groundswell of support for [Fed Vice Chair] Janet Yellen to take the helm is likely. We have to wonder, however, if Summers’s decision is a signal that the smartest man in the room sees too much trouble ahead and that is why he chose to stand down.”
Stocks are holding positive ground in morning trading. Both the Dow Jones Industrial Average and the S&P 500 are near new highs. Summers was seen as an opponent of the Fed’s quantitative easing (QE) policies, which have been very supportive of Precious Metals prices and the stock market. Yellen, however, is seen taking a more dovish approach to QE. Deutsche Bank’s Gael Gunubu said, “The market will, at the margin, see his withdrawal as one which prolongs unorthodox policy for longer — partly because it moves the more dovish Yellen up the favorites list for the new job.”
At 1 p.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,317.70, Up $9.10.
- Silver, $22.02, Up $0.29.
- Platinum, $1,443.30, Down $2.20.
- Palladium, $705.10, Up $7.00.