Mid-Day Gold & Silver Market Report – 5/22/2013
GOLD FLAT AFTER FED TESTIMONY
When U.S. Federal Reserve President Ben Bernanke speaks, the Gold market listens. Today was no different when Bernanke said it was too early to slow down the central bank’s easing program based on current economic conditions. "The correlation of the dollar with Gold has been quite strong lately, and today's weakness in the U.S. currency after Fed officials said it may be too early to be pulling back of QE (quantitative easing) certainly helps the metal," Societe Generale analyst Robin Bhar said. However, after an initial spike in the Gold price, the market had a quick correction. "We are getting corrective bounces, but we are still in a downtrend, and these bounces are not strong enough to reverse that as investors continue to divest and physical demand is not as strong as it was one month ago," added Bhar.
While the United States looks toward the end of monetary easing, Japan’s central bank is expanding its stimulus program. "Such conduct of monetary policy will support the positive movements in economic activity and financial markets, contribute to a rise in inflation expectations, and lead Japan's economy to overcome deflation that has lasted for nearly 15 years," the bank said in its policy statement. Because Japan is the third largest economy in the world, the effects of their policies will be felt beyond the country’s borders.
At 1:00 pm (EDT), the APMEX precious metals spot prices were:
- Gold, $1376.70, Down $3.90.
- Silver, $22.66, Up $0.10.
- Platinum, $1473.90, Up $14.00.
- Palladium, $753.60, Up $3.50.
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