Daily Gold & Silver Market Report – 9/23/2016

Jennifer Carter

9/23/2016 12:44:00 PM

GOLD MOVES TOWARD TWO-WEEK HIGH; FED STEADY ON NO RATE INCREASE

Gold edged toward a two-week high Friday and remained headed for its biggest gain in nearly two months.  The Federal Reserve is still leaning toward a slow and careful approach to raising interest rates, though investors expect a hike in December.  The yellow metal is sensitive to any interest rate change.  Spot Gold was up more than 2 percent on the week for its best weekly performance since late July. Stocks were on course for their largest weekly gain in two months as investors remain unconvinced of the Fed’s intent to reverse ultra-low interest rates. "That's the sort of environment where Gold will flourish, because it creates uncertainty, and it keeps rates low," ING analyst Hamza Khan said. "The rest of the world has also been quite healthy (for Gold) -- we've had dovish signals from the Bank of Japan, and we've seen ETF holdings beginning to recover."

Federal Reserve Chair Janet Yellen signaled there likely will be an interest rate increase in December, but Boston Fed President Eric Rosengren wanted it this week as he thinks it would help prevent a recession later. Rosengren said he argued for “a modest, gradual tightening: out of a concern that not doing so would put the recovery’s duration and sustainability at greater risk, by generating the sorts of significant imbalances that historically have led to a recession.”  If there isn’t a hike soon, he thinks there could be several hikes in the future.  The Fed as a whole, however, seems to think the U.S. labor market has room to grow and will hold off on an interest rate increase for now.

At 12:44 P.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,340.80 Down $2.60
• Silver, $19.84 Down $0.25
• Platinum, $1,057.40 Down$6.40
• Palladium,$740.60 Up $5.20

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