There was little movement in the precious metals market today as gold and silver continued to trade on narrow margins. Gold was up to slightly to $1253.60 an ounce by the time traders finished for the day in London whilst the silver spot charts settled on $19.09 per troy ounce.
Despite the slight gains, precious metal prices look vulnerable against stocks given the global economy is signalling an optimistic outlook. The US non-farm jobs data continued to give confidence to traders in Wall Street and with results coming in as expected, the dollar is continues to pick up strength against a basket of other currencies.
The bank holiday across mainland Europe also nullified progress for precious metals either way. Gold in particular is struggling to improve on recent losses and interest is likely to thin over the course of the next week despite the ECB’s imminent rate cut on bank loans rather than risk a quantitative easing (QE) program.
In the US, the Federal Reserve will continue to taper its stimulus measures by cutting back another $10 million for June. Janet Yellen has suggested QE will end completely in the autumn, most likely in October or November.
Low interest rates
Shares continue to pick up pace and hit all-time highs on Monday, boosted by the improving health of the global economy and worldwide interest rates at record lows. US jobs data further boosted the market sentiment towards the greenback as results reached their peak before the 2008 banking crisis.
Despite the positive data, gold did recover substantial losses after Friday’s results were published, but analysts say the rally was due to short-covering by traders who had bet against upbeat data. However, future have been cut and market speculators do not think the rally will hold.
The forecast is good news for consumers who are looking for a safe long-term investment that promises a significant ROI. Buying physical gold is a firm favourite with consumers looking to boost their pension funds as the yellow metal has a reliable history of strong gains – providing you buy when prices are low.
Although the economic recovery is slow, the global marketplace is looking stronger and gold and silver prices will fall gradually. This presents a good opportunity for consumers to purchase physical precious metals over a long period of time. Start now and you can build a reasonable supply at low prices.
Until recently buyers have been sitting on their hands waiting for gold prices to fall to levels analysts anticipated before the turn of the year. The average value of the yellow metal was forecast at around $1220 an ounce, although this figure was revised to $1250 due to the Ukraine crisis.
Buyers have now started to show a little more interest, although many are still holding out for further falls in price. There is still the chance that gold could suffer heavy losses between now and the end of the year.
On the other hand another geopolitical crisis could fuel prices so to be on the safe side, visit coininvest.com and start accruing your gold today whilst stocks last and whilst prices are low.