Gold & Silver Flat Ahead of FOMC Minutes
APMEX
7/5/2021 12:32:34 PM
Gold & Silver Flat Before FOMC Minutes
Traders are looking at a shortened week, as major U.S. markets are closed Monday in observance of Independence Day. Both metals are relatively flat to begin the week. Silver is currently around $26.40, while gold is near $1,792 amid a subdued dollar and mixed jobs data that was released on Friday.
The data from the Bureau of Labor Statistics revealed that more jobs were added in June, but unemployment rates have actually increased. Many investors were looking to the jobs report for insight into how reopening is going. Given the report may not have provided solid direction, investors will certainly be eying several key events this week.
The initial focus will be on Tuesday’s release of the Institute for Supply Management (ISM) services index. As the economy reopens, the ISM services index provides a gauge in terms of service sector purchasing and business growth. The mood is positive ahead of this report, but disruptions in the supply chain may also be a detractor.
FOMC meeting minutes from the June Fed meeting are set to be released Wednesday afternoon. These minutes should provide investors with more clarity regarding projections of Fed tapering or the slowing down of asset buying by the Fed.
June’s Fed meeting revealed increased inflation projections, and two potential rate hikes before the end of 2023. Investors will look to the meeting minutes to clarify what specific barometers are being used to measure inflation and the economic benchmarks that would need to precede rate hikes.
The ISM Services Index and FOMC meeting minutes are the two key events this week, with a light week in terms of scheduled events. Data from these events will likely provide needed insights to investors looking for data to determine risk appetite.
The stock market will reopen tomorrow as major indices are still hovering near record highs, seemingly shrugging off inflation concerns. Historically, shortened trading weeks have increased the volatility of gold and silver markets amid lighter volumes. Precious metals could be reactive to dollar movements and significant news stemming from the FOMC meeting minutes.
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