Daily Gold & Silver Market Report – 9/1/2016

Marcey Hollon

9/1/2016 11:21:00 AM

GOLD DROPS AHEAD OF U.S. JOBS DATA; IMF LIKELY TO CUT GROWTH OUTLOOK

A positive non-farm payrolls report Friday may be what the Federal Reserve needs to stay on track with raising interest rates. The labor market remains strong with fewer-than-expected unemployment claims last week. Spot Gold reached a two-month low as investors await the upcoming economic data. "Generally speaking the U.S. economy seems to have improved over the past few weeks and the interest rate expectations have risen quite significantly," Commerzbank analyst Daniel Briesemann said. "Gold could fall below $1,300 [per ounce], even if the market is pricing in good jobs data tomorrow." Policymakers are in disagreement over the strength of the economy, with Boston Fed President Eric Rosengren wanting quicker moves in rate hikes while Chicago Fed President Charles Evans thinks economic growth has permanently stalled.

International Monetary Fund Managing Director Christine Lagarde said the institution’s 2016 global growth outlook will probably be downgraded due to weak demand. Lagarde believes far more needs to be done by the G20 leaders to boost demand for trade. Although the global economy has not incurred major impact from recent economic events, Lagarde feels the global outlook is fragile and not being fueled by trade. "You could argue that Brexit is not really delivering the massive crisis that we had expected, you could argue that the Chinese transition is proceeding reasonably well, and you could argue that low commodity prices have gone up a little bit," Lagarde said. "So this is on the surface. However, when you look deep down at the economic growth prospects, at the growth potential, at the productivity, we are not getting very good signals, and we will probably be revising down our forecast for growth in 2016."  If another downgrade occurs, it will be the sixth-straight downgrade in 18 months.

 

At 12:20 P.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,315.70 Up $4.90
• Silver, $18.89 Up $0.20
• Platinum, $1,046.00 Down $5.50
• Palladium,$662.10 Down $7.80

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