Mid-Day Gold & Silver Market Report – 9/17/2014

Peter LaTona

9/17/2014 11:48:00 AM

ALL EYES AWAIT FED NEWS CONFERENCE

Gold and Silver prices are showing little movement, while the U.S. stock market is losing early morning momentum, as all eyes await the Federal Reserve statement scheduled to be released at 2 p.m. (ET). Thirty minutes after the release of the Fed statement, Fed Chair Janet Yellen will conduct a news conference. "I guess the market is anticipating a loosey-goosey Fed," BMO Private Bank chief investment officer Jack Ablin said. I don't think Fed policy is going to change much, maybe the rhetoric changes some. But interest rates can rise and not upset the equity apple cart, at least U.S. large caps, because while large caps appear expensive relative to their own history, they are cheap viewed through the lens of bonds. "The [Consumer Price Index] certain doesn't add a lot of enthusiasm for tightening. If I were Yellen, I'd like to see very solid evidence of either real growth or some inflation before we start turning the dial."

The Consumer Price Index fell in August for the first time in 16 months, largely because of a decline in gas prices. Lower gasoline costs helped offset the increase in the price of food, as beef and veal prices jumped 4.2 percent, marking the biggest increase in 11 years. Economists surveyed by MarketWatch expected the CPI to be flat and instead it came in at 0.2 percent. The August drop lowered the 12-month inflation projection to 1.7 percent. Although low inflation might be viewed as a positive for households, it should be noted that real wages went up only 0.4 percent and are not keeping up with inflation.

At 1:00 p.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,237.80 Up $0.10
• Silver, $18.79 Up $0.01
• Platinum, $1,362.70 Down $5.60
• Palladium, $839.20 Down $5.10

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