August 13th Midweek Gold Market Update

Precious metals are receiving some support during the first half of the day on Wednesday, but such support is doing more in the way of mitigating losses than it is contributing to any gains being made by metals. Seeing as we are now in the middle of the month of August, it should come as no surprise that we are presently witnessing a much quieter market atmosphere than normal. With investors more focused on family vacations and other outdoor activities, there really isn’t a boatload of trading going on this week.

Geopolitics, though in the news already this week, are being monitored by investors more sparingly this week. A potential standoff between Ukrainian troops and a Russian humanitarian truck convoy is in the works, but may not unfold for another day or so yet.

Gold Helped By Stagnant Retail Sales Data

Though by looking at spot values alone it may not seem like it, gold and silver have been helped this morning by weaker than expected retails sales reports from July. After it was reported that retail sales rose by .2% in June, investors and market analysts were expecting to see a similar rise during the month of July. Unfortunately, retail sales didn’t change much at all during July, according to the reports.

This news caused the US Dollar to take a bit of a hit, but as of the writing of this post the greenback was once again beginning to trend a little bit higher.

As we head into the duration of the week, it is very likely that investors will continue to monitor and analyze the plethora of ongoing geopolitical situations throughout the world. Islamic State rebels are still wreaking havoc throughout much of Northern Iraq and Southern Syria, and just last week, US President Barack Obama sanctioned the use of airstrikes against the rebel group.

On Monday, reports began surfacing with regard to a Russian humanitarian aid convoy heading from Moscow to the besieged Ukrainian city of Luhansk. The convoy, which consists of more than 200 vehicles, is said to be loaded with food and medical supplies, but because it has not been inspected or certified by the Red Cross, no one can say for sure what the contents of the convoy are. Ukrainian officials have stated that it will not be allowed into the country and that, if Russia is so intent on helping the people of Luhansk, they should simply lay down the supplies and food at the border and allow Ukrainian forces to physically deliver them. The Russian Federation has not responded to Ukrainian complaints, and has not even verified that the convoy is headed for Luhansk. By week’s end, I anticipate that we will find out much more about this developing situation. With little else for investors to pay attention to, I also anticipate that geopolitics will remain one of the foremost concerns of the investing world.

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