Precious metals are going to finish the day and the week having recorded losses. Though this is unfortunate, it is not so unexpected considering the quiet nature of this 5-day trading session. There hasn’t been much economic data on the table, and what little data was made public ended up having a negative impact on the spot values of gold and silver. Looking ahead to next week, things are likely to remain subdued and slow, which is none too positive news for gold and silver.
Something that did help the prospects of precious metals, at least momentarily, was the onset of fresh US airstrikes in Syria. Though the market was expecting the US to become more involved in the Middle East, it was not expected that they would be targeting ISIS strongholds in Syria so soon. This news ended up providing precious metals with a bit of a boost through the first 2 days of the week, but by Wednesday, those gains had been reverted. Though the market is not paying nearly as much attention to the Middle East today as they were on Monday and Tuesday, I am sure this situation will make its way back to the headlines sooner rather than later.
US Dollar Continues to Impress
Over the course of the past two months, the US Dollar has been on an almost unending move upward. The greenback has made massive gains against many rival currencies and is still hanging on to plenty of momentum. Just this week, the Dollar was boosted by a report from the United States claiming that sales of new homes during August were their best in quite some time. This upbeat economic news only lends credence to the belief that interest rates in the US will be raised sometime in the near future. This growing belief is great for the USD simply because as confidence in the US economy grows, so too will confidence in the US Dollar.
Against the Euro specifically, the Dollar has been making huge gains. The reason for this is due to the diverging nature of the US Fed and European Central Bank’s monetary policies. So long as accomodative measures are being taken in Europe and policies are tightening in the United States, most experts agree that the current trend will last through the foreseeable future.