This week was yet another holiday trading week, though gold and silver were able to pull off some modest gains. Apart from physical buying, gold and silver did not have much of anything substantial to push them towards the gains they made. This could mean that Thursday and Fridays’ positive numbers are nothing more than a fluke, but it could also mean that gold and silver have begun their long path to recovery.
Now that we have finally gotten 2014 underway, it is only right that we talk about what the future might possibly hold for precious metals.
2014′s Possible Implications for Precious Metals
Gold has turned the first two normal days of trading in 2014 into over $30 in gains while silver has added three-quarters of a dollar to its spot value. While many people feel as though these gains are nothing more than an isolated spike due to physical buying, others are interpreting this week’s gains as being the start of a bullish run for the metal. Whether one of these two beliefs is true or not is yet to be seen, but one thing that is for certain is that precious metals investors will be hoping for a better year in 2014 than they experienced in 2013.
First on the slate for investors is the upcoming debt ceiling deadline. While you may remember the US’ borrowing limit being reached in October and a temporary raising of the debt ceiling coming as a result, lawmakers raising the debt ceiling back in October was nothing more than a temporary fix. Now, the same problem is on the verge of poking its head out again as the temporary deal reached back in October is set to expire in the early parts of February. While February may seem like a while away, the debt ceiling deadline becomes more of an issue with each passing day. At this point it is unclear what the borrowing limit being reached might mean for precious metals as far as spot value movement is concerned, but it is certain that it will affect the US marketplace in some way or another and is something investors should keep an eye on.
Also on the mind of investors is the Federal Reserve and what their actions may be over the course of the next 12 months. A recent Quantitative Easing tapering decision made by the Federal Reserve and comments made by Ben Bernanke have caused a lot of people to believe that more tapering measures will be made throughout the year. The possibility of more tapering will undoubtedly unnerve precious metals investors, though whether or not more tapering will happen is yet to be seen.
2014 is already looking up for precious metals, though it is no secret that it is too early to tell what direction metals will head long-term.