August 1st Weekly Silver Market Update

Precious metals spent a majority of this week trading downwards in direct response to some better than anticipated US economic data. In fact, this week as a whole saw investors focus their attention on few things that weren’t directly related with the heavy slate of US economic reports.

Despite the month of July being somewhat poor for precious metals, it is encouraging to see gold and silver end the week fighting to regain some of the momentum that was lost over the last few weeks. With so many sources of violence scattered throughout Europe and the Middle East at present, precious metals may not be completely forgotten about by the investing world. It will be interesting to see how the violence in Gaza and Ukraine develops over the weekend and if either will develop into something of primary concern for investors. As of now, both situations are sitting comfortably on the back-burner of the marketplace’s attention.

Weak Employment Report Halts USD’s Progress

For an overwhelming majority of this week, investors have been focusing exclusively on the slew of economic data streaming out of the United States. One of the most important pieces of information made public this week was, as it always is, the employment figures from July. As a great gauge of economic strength month in and month out, investors are always curious to see how many new jobs were added to the US economy.

July’s figures, which were released earlier today, showed that just under 210,000 new jobs were added to the US economy during July. Compared to June’s near 300,000 job addition, and expectations that at least 230,000 would have been added in July, today’s figures were shockingly disappointing. As a result, US equity markets continued along their two-day slide while the US Dollar was seen trading downwards for the first time this week. Gold, silver, and other precious metals were aided by the weak employment report, but only slightly. As we head into the weekend and then into next week, it will be interesting to see how investors continue to react to today’s jobs figures.

Other US Economic Data This Week

Apart from today’s employment report, this week played host to a number of economic datapoints investors were curious to find out more about. As is always the case, a good bit of attention was paid to the FOMC’s policy meeting and post-meeting statement, which was made on Wednesday. While investors were hoping to hear additional information with regard to the future of interest rates in the United States, they were instead greeted with discussion regarding the imminent conclusion of Quantitative Easing. The monthly bond-buying initiative was reduced by an additional $10 billion and is set to be completely done away with by sometime this upcoming Fall.

Also made public on Wednesday was the second-quarter GDP report for the United States. Beating expectations, it was reported that the US economy grew by more than 4% on an annualized basis this second quarter. As you could have probably guessed, this information worked in favor of the US Dollar and put a decent dent in the progress of precious metals.

As we head into next week, I expect investors to continue mulling over the large quantity of data which was made public this week. Though it has already made an immediate impact on the marketplace, it will more than likely play a major role in shaping the investing decisions of many investors going forward through this year.