Weekly Gold & Silver Market Recap – 9/12/2014

Peter LaTona

9/12/2014 4:10:00 PM

GOLD & SILVER PRICES FALL ON A STRENGTHENING U.S. DOLLAR & EASING GEOPOLITICAL TENSIONS

Gold and Silver prices took a big step back this week with prices dropping from Monday’s opening prices. The loose monetary policies in Europe, China and Japan continue to de-value their currencies and conversely drive the U.S. dollar to highs we have not seen as of late. Safe-haven appeal is moving out of other currencies and into the U.S. dollar. 

Safe-haven concerns fell this week as tensions in Ukraine and the Gaza Strip have eased for the moment. This did not stop the U.S. and the European Union from announcing new, harsher sanctions over Russia. For the first time, Russia’s Sberbank was targeted. These sanctions will affect oil and defense industries and further limit the access of major Russian banks to U.S. debt. The European penalties included asset freezes on leading Russian politicians and restrictions on financing for some Russian state-owned companies.

An interesting development in Scotland could have an effect on Gold prices later this month. Scotland’s voters go to the polls on September 18 to decide whether they should break away from the United Kingdom, or not. If Scotland does vote for independence, there will be a distribution of assets that will include Gold.  The U.K. owns about $12.6 billion and is the 18th largest holder of Gold (central bank holder). Scotland would also be faced with the decision as to whether or not to create their own currency.

Nothing goes up forever and investors are aware that U.S. equities have experienced a very long winning streak. When will U.S. equities lose steam and correct? Until this happens, it is likely that Gold and Silver prices will remain under pressure. Both Precious Metals and equity markets will continue to try and read the “tea leaves” and anticipate future Federal Reserve action. The ending of QE3 is a foregone conclusion, but when will the Fed raise interest rates and can they accomplish this without major disruptions? The next Federal Reserve Open Market Committee is September 16-17.

At 4:15 p.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,230.30 Down $9.20
• Silver, $18.66 Up $0.04
• Platinum, $1,372.50 Up $0.80
• Palladium, $839.20 Up $6.00

APMEX’s Account Managers now have extended hours Mondays through Thursdays and are here to serve you until 8 p.m. (EDT)! Or call us Fridays until 6 p.m. (EDT)! If you have any questions about investing in Precious Metals or simply would prefer to place your order by telephone, we are here to help.