SILVER PRICES POISED FOR FIRST WEEKLY LOSS OF 2017

Cassie Bastien

1/27/2017 9:47:00 AM

Daily Gold & Silver Market Report – 01/27/2017

Silver spot prices declined Friday and are looking at their first weekly loss in five on stronger risk appetite and profit-taking. “For the week, the gray metal is on track to lose nearly 2 percent,” Sam Bourgi with EconomicCalendar.com reports. “Gold’s premium over Silver has declined sharply over the course of January. As of Thursday, one ounce of Gold was worth 70.74 ounces of Silver.” Stronger risk appetite led to Precious Metals volatility throughout the week. Bourgi said, “U.S. stocks soared to new records throughout the week, with Asian and European equities following suit.” Although European demand softened as banks declined, Asian stocks continued climbing.

GOLD EXPORTS TO CHINA SOAR 

Switzerland and Hong Kong, two major Gold suppliers, saw increased exports to China in December in the run-up to the Lunar New Year, beginning Jan. 28. According to Swiss Federal Customs Administration data, more Swiss Gold was sent to China, the world’s top consumer, during December than in any month since at least January 2014. The start of the Year of the Rooster is associated with gifting the Precious Metal. Bloomberg.com reporters Ranjeetha Pakiam and Eddie Van Der Walt said, “lower prices at the end of last year, brought on by a stronger dollar as the U.S. increased interest rates, supported demand. … The declining [Chinese] yuan may also have spurred Gold investment, while demand is traditionally higher before the Lunar New Year. … Gold for immediate delivery is up 2.5 percent this year at $1,186.92 an ounce.” Gold saw its best year since 2011 last year, as global uncertainty, including President Donald Trump’s election and Britain’s decision to leave the EU, rattled markets. “There’s been a tail-wind behind Gold, and China’s just one of the directions from which it is blowing,” Ken Hoffman, Senior Metals and Mining Analyst at Bloomberg Intelligence, said by phone from Princeton.

DOLLAR HIGHER AS YEN COMES UNDER PRESSURE

The U.S. dollar was particularly strong against the yen as action taken by the Bank of Japan was seen as a message that a tapering of its asset-purchase program wasn’t on the table. MarketWatch reporters Hiroyuki Kachi and Ryan Vlastelica said, “the dollar came off its highs of the session after a weaker-than-expected read on fourth-quarter economic growth.” The Bank of Japan’s (BOJ) decision on Friday to increase purchases at a regular Japanese government bonds (JGB) buying operations also pushed the yen lower, as investors became mindful of U.S.-Japan interest-rate differentials. “We’ve seen an unexpected increase [by the BOJ in the buying amount] to give us a surprise,” said Senior Researcher at Gaitame.Com Research Institute, Takuya Kanda. The action came after the central bank decided Wednesday to omit a buying operation, which sparked speculation among traders about a scaling back of purchases. In January, Kachi and Vlastelica said the U.S. dollar index is “down 1.5 percent, although it is up 1.8 percent over the past three months, with much of that rally coming in response to Donald Trump’s election.” Trump is expected to pursue policies that could accelerate economic growth and stoke inflation, benefiting the dollar.

At 10:47 A.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,189.90 Down $2.90
• Silver, $16.97 Up $0.06
• Platinum, $975.10 Down $5.60
• Palladium, $734.40 Up $8.40

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