Daily Gold & Silver Market Report–1/6/2016

Brandi Brundidge

1/6/2016 9:08:00 AM

GOLD UP ON GLOBAL ECONOMIC UNCERTAINTIES; THE FED’S NEXT MOVE

Gold reached a four-week high Wednesday as fears rise over global economic conditions and geopolitical concerns.  Gold hit a high in December at $1,088.70 per ounce and was able to rebound twice from the $1,045 price range; therefore analysts believe if Gold stays above $1,088 it has possibly bottomed out for now.  "As we go higher, we could see some of that physical demand beginning to slow. Now we need investors to jump back in and look to hedge some of the uncertainties over global growth, over China, with positioning in Gold," Societe Generale analyst Robin Bhar said.  China added fuel to global concerns by allowing the yuan to decline further, which caused world stocks to fall for a fifth consecutive day Wednesday. Also Wednesday, North Korea confirmed it successfully tested a miniaturized hydrogen nuclear device, which could cause market movement over additional international uncertainties.

Federal Reserve Vice Chairman Stanley Fischer explained Wednesday the Federal Reserve’s path to hike rates in 2016 and how the market appears to underestimate their approach.  "We watch what the market thinks, but we can't be led by what the market thinks," he told CNBC's "Squawk Box," adding the markets' expectations of future rate hikes are "too low."  In December, central bankers projected the Fed would increase rates four times in 2016 and according to Fischer those numbers remain accurate, but growing global uncertainties could slow down the hikes.  Minutes from the Fed’s December policy meeting will be released today, which might provide clues to their strategy. 

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

• Gold, $1,092.30 Up $10.60
• Silver, $14.07 Up $0.01
• Platinum, $878.30 Down $11.60
• Palladium, $520.90 Down $15.90

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