January 16th Weekly Silver Market Update

Though minor losses are being posted as of the writing of this post, precious metals are still going to be looking at fairly healthy weekly gains. In fact, the first two weeks of 2015 have been extremely beneficial for precious metals and, in all honesty, it seems as though the market’s outlook on precious metals is changing. Now, gold and silver have the near-term technical advantage and are seeing an increasing number of investors become more bullish on the prospect of investing in metals.

All in all, this week was once again full of economic data from all over the world. With that said, however, most of the market’s attention was directed at data from Europe as it is widely expected that we will see a policy shift come as a result of next week’s European Central Bank meeting. In addition to this, investors were also dealt a fair batch of economic data from the United States, but this did not affect the market nearly as much as the data from Europe.

Swiss National Bank Makes Surprise Move

The biggest news story of the week came on Thursday in the form of a surprise decision on the part of the Swiss National Bank. According to most European news outlets, the SNB decided that it would immediately move to unpeg the Franc from the Euro. With the Euro in free-fall for the past few months and only looking like it will get weaker, it really isn’t too shocking that the SNB made this move.

For those who are unaware, the Swiss National Bank initially decided to peg the Franc with the Euro back in 2011 in an effort to prevent the currency from gaining too much value too quickly. Now, with the Euro still on the decline, it will be interesting to see if any other countries whose currencies are pegged with the Euro will make a move similar to the SNB’s.

In other news from Europe, it was reported on Wednesday that the European Court of Justice ruled that the European Central Bank’s plans to implement quantitative easing measures was legal. Though the market was already more or less convinced that quantitative easing measures were just around the corner for the EU, this report confirms, for many, that the ECB, at their meeting next week, will decide to announce the implementation of QE. Though this is not a definite, this week’s ECJ ruling has many people thinking that next week’s meeting is the perfect time to announce this big shift in policy.

Retail Sales in US Mostly Disappoint

Despite the fact that most of this week saw the market focus entirely on economic data and happenings from Europe, the attention of investors was drawn, briefly, to the latest retail sales data from the United States. December’s retail sales are historically some of the year’s best simply because of all the Christmas shopping that gets done during the month. This time around, however, investors had a retail sales decline of .9% to chew on. Compared to expectations of a .2% rise in retail sales, it is clear to see that these figures were quite disappointing.

This news did the Dollar and equities no favors, but helped the precious metals market considerably. Helping gold and silver even more is the fact that experts are now convinced that the Fed will hold off on raising interest rates for some time now. As we look ahead to next week, it will be interesting to see what the European Central Bank meeting has in store for investors.