Daily Gold & Silver Market Report – 1/15/2015

Brandi Brundidge

1/15/2015 10:31:10 AM

GOLD CLIMBS AFTER SNB ABANDONS CURRENCY CAP; UNEMPLOYMENT RATE RISING

Gold jumped more than 2 percent today on shocking news the Swiss National Bank (SNB) will abandon its three-year currency cap of 1.20 francs per euro.  "Gold is gaining from a risk-off situation because nobody expected the Swiss central bank not to keep that cap, and this has created potential big losses in many places and is obviously triggering some flight to safety," Saxo Bank senior manager Ole Hansen said. The currency cap was initially enforced in 2011 after the SNB’s failed attempt to fight deflation by purchasing foreign bonds.  The European Central Bank (ECB) meets next week and is expected to announce a new round of fiscal strategy, which could be behind Switzerland’s bold move to exit its previous policy.  "This is happening a week before the ECB meeting, which could add even further pressure to the euro ... more [quantitative easing] in the [eurozone] is a double-edge sword for Gold in dollar-denominated terms but Gold in euro terms should benefit," Hansen said.

The U.S. job market appears to be performing poorly after reports showed last week’s number of new unemployment benefit claims increased to the highest level since September.  Almost 3 million new jobs were added to the market last year, the largest annual rise since 1999.  The market anticipates the job market will play a major role on when the Federal Reserve decides to raise interest rates later this year.

At 11:30 a.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,266.40 Up $29.90
• Silver, $17.21 Up $0.18
• Platinum, $1,264.00 Up $25.00
• Palladium, $771.50 Down $10.10

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