Daily Gold & Silver Market Report – 9/16/2015

Brandi Brundidge

9/16/2015 9:23:00 AM

PRECIOUS METAL PRICES JUMP AS FOMC MEETING BEGINS

The Federal Reserve begins a two-day policy meeting Wednesday to discuss the economy and possibly increasing interest rates for the first time in almost a decade.  The market is uncertain on the direction of the Fed on been growing concerns over global economic stability and unpredictability in financial markets. “I see three options: no change, rate hike with a hawkish statement or rate hike with a dovish statement,” Saxo Bank head of commodity research Ole Hansen said. “The first two will be Gold negative while the last (which is my preferred option) could trigger a recovery as it removes the uncertainty and should keep the dollar from rising [too] fast.” Gold has been pressured by the Fed’s interest rate hike announcement, falling 6 percent this year.

Investors are eyeing hints from the Fed on if a rate hike will happen this month or in the near future.  Anthony Chan, chief economist at JPMorgan Chase's private client group, believes rates should not increase until December, telling CNBC the Fed must make a strong case to the market if they decide against a September rate hike. The volatility in financial markets and global growth could prevent the Fed from raising rates this month, but Chan noted Fed Chair Janet Yellen could lose credibility.  “We know that other central banks in the past have moved and had to reverse themselves and I think you lose some sort of credibility when you have that sort of behavior. I'd feel more comfortable if the Federal Reserve when there was no doubt in anyone's mind that it was the right thing to do and the risk of them having to reverse course was minimal,” Chan said. 

At 10:20 A.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,121.70 Up $15.60
• Silver, $14.93 Up $0.50
• Platinum, $972.70 Up $13.50
• Palladium, $608.80 Up $6.30

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