Daily Gold & Silver Market Report – 12/11/2015

Jennifer Carter

12/11/2015 10:00:00 AM

GOLD, OIL  DOWN PREPARING FOR FEDERAL RESERVE MEETING

Spot Gold fell 0.7 percent to $1,064.11 an ounce Friday morning after closing flat the last two sessions. The metal was on track for a two percent decline for the week and a seventh weekly drop. Investors are prepared for the Federal Reserve to announce the first interest rate hike in nearly a decade at their next policy meeting, set for Dec. 15-16. "What we are likely to see in the next three months is the discussion moving from the rate hike to the pace of rate tightening cycle," ETF Securities strategist Martin Arnold said. "A broad range between the high $1,080s to $1,030 [per ounce] is where we are going to see Gold in the first quarter, starting towards the lower end of the range in a knee-jerk reaction to the Fed's move and then grinding higher throughout Q1."   

Oil prices have tumbled near seven-year lows, below $40 per barrel, in December after OPEC failed to impose a ceiling on its output. The market will remain oversupplied until the end of 2016 or further. Crude oil prices near 2009 lows also hurt bullion prices and has some speculating again Gold could drop to $1,000 an ounce. "As extra Iranian oil hits the market, inventories are expected to swell by 300 million barrels. Concerns about reaching storage capacity limits appear to be overblown," the International Energy Agency said. "Much of the excess oil will be soaked up by 230 million barrels of new storage capacity additions, while U.S. inventories are only 70 percent full. As inventories continue to swell into 2016, there will still be a lot of oil weighing on the market."

 

At 10.00 A.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,077.30 Up $2.00
• Silver, $13.96 Down $0.24
• Platinum, $853.10 Down $13.80
• Palladium, $542.20 Down $1.10

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