Closing Gold & Silver Market Report – 9/16/2013
METALS FLAT AHEAD OF FED MEETING; PIMCO CEO PREDICTS FED NEXT MOVE
Precious Metals have remained flat for the day as the market patiently waits for the Federal Reserve’s two-day meeting to begin on Tuesday. Bullion prices have dropped by 19 percent this year ever since the Fed stated their plans to cut back quantitative easing in 2013 and possibly end it in 2014. “The prospect that the Fed's tone will remain dovish is good for equities but not for Gold at the moment, as you would need a combination of yields dropping and inflation expectations moving up to really see Gold stronger," Credit Suisse analyst Karim Cherif said.
Pimco CEO and co-CIO Mohamed El-Erian shared his thoughts with CNBC Monday on this week’s Federal Reserve meeting and the likeliness that tapering of its $85 billion monthly asset purchases will be announced. El-Erian expects the Fed to scale back its bond buying program by about $10 billion to $15 billion. “The reason why we're going to see the taper is not because of the declared ‘big victory on the economy’”, El-Erian said, "[but] because they're worried about what Mr. Bernanke called the cost and risks—the collateral damage if you like—of using such a blunt instrument to impact markets.” El-Erian foresees interest rates to remain the same as the U.S. economy has not exactly reached a full recovery.
At 5:15 p.m. (ET), the APMEX Precious Metals spot prices were:
- Gold, $1,315.60, Up $5.00.
- Silver, $21.85, Up $0.11.
- Platinum, $1,437.80, Down $7.70.
- Palladium, $703.50, Up $5.50.