European Poll Worries Cause Gold to Rise

Cassie Bastien

3/15/2017 10:10:07 AM

Daily Gold & Silver Market Report – 03/15/2017

Reuters reported the outcome of Dutch elections has caused a bit of uncertainty throughout markets Wednesday while many await the outcome of the Federal Open Market Committee meeting, causing spot Gold prices to rise. Now that everyone believes an interest rate increase is certain, investors have turned their attention to what message the Federal Reserve will deliver. Although INTL FCStone analyst Edward Meir said, "Our bias is still somewhat constructive on Gold given that we think the Fed will shrink from coming across as too aggressive,” he doesn’t think much will change after the Fed's policy statement, set for 1800 GMT Wednesday. However, Gold’s appeal has risen due to the focus on Dutch elections. "We expect the bullish bias to continue throughout the session as the Dutch election gives the yellow metal a slight safe-haven bid," Jeffrey Halley, Senior Market Analyst at Forex company OANDA, said.

Will Silver ETFs Rebound?

March has been a tough month for spot Silver prices, leaving many investors wondering when or even if the Precious Metal will rebound. With the help of the expanding solar industry, the demand for the gray metal has steadily increased. In fact, as Henry Sanderson for the Financial Times reports, “Installations and investment in solar panels, which incorporate Silver for its electrical conductivity, are at record levels.” Silver also enjoys heavy industrial demand, benefiting from an expanding global economy. Tom Lydon with ETFTrends.com said, “If professional investors start moving away from equities, Precious Metals, including Silver, could benefit.” Lydon also mentioned influxes to Silver ETFs have been mixed thus far, indicating that investors may be concerned about the impact of the Fed raising interest rates on commodities including Precious Metals.

• Over 50 percent of global demand for Silver comes from industries like chemicals, medicine and technological appliances.

How the Fed Convinced Markets A Raise in Interest Rates is Certain

After a subtle hint from the central bank’s meeting in February, investors see the interest rate hike as a sure thing Wednesday. Bloomberg reporter Jeanna Smialek said, “The change came after Fed policy makers launched an aggressive communication campaign, talking markets into the idea that rates would be climbing this month.” After a multitude of events, including Federal Reserve Chair Janet Yellen’s Chicago speech in early March and a U.S. Labor Department report showing more than 230,000 jobs added in February, monetary policy-watchers are convinced March 15 will mark the first official interest rate hike of 2017.

At 11:09 a.m. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,201.40 Down $4.00
• Silver, $16.93 Down $0.07
• Platinum, $938.00 Down $2.90
• Palladium, $745.90 Up $2.70

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