Gold and silver spot values are maintaining their bearish posture for yet another day on Wednesday. This week has thus far proven to be a bit slower than normal, and this fact alone has, and continues to, work against the value of metals. Though stocks and the USD have not performed particularly well this week either, they are still both very bullish and almost continuously trending higher.
In the United States on Tuesday, William Dudley, president of the New York Federal Reserve, made remarks indicating that interest rate dissenters at the FOMC meeting do not necessarily mean that rates are going to be on the rise sooner than anticipated. In case you missed it, a few FOMC members dissented against the statement made by the group–a move that indicated to many investors the members’ intentions of raising interest rates prior to the June 2015 projections. Dudley’s statements convinced some that June 2015 or even some later date is when interest rates will be raised; this provided gold and silver spot values with a little bit of a boost yesterday.
Market’s Focus Momentarily Turns to Syria
Through the first few days of this week, things have been very quiet due to a lack of economic data that is, in turn, yielding a more subdued economic atmosphere. Because investors have so little to focus on, the attention of the market yesterday turned to reports indicating that the US military was striking (with air power) ISIS targets throughout Syria. Though president Barack Obama announced a few weeks ago that airstrikes against ISIS in Syria were on the table, no one expected him to act on his remarks so quickly.
The onset of the United States’ attacks in Syria caused the marketplace to panic a bit. This ended up helping gold and silver yesterday as safe-haven demand propped metals up for the day. Unfortunately, however, the help provided by the United States’ newest military operation was short-lived to say the least.
As we head into the second half of the week, I expect some attention to continue to be paid to the situation in Syria. After all, with Russia being such close allies with Syria, there is no saying for sure if Vladimir Putin will have any sort of reaction or not. If you can recall to a few weeks ago, Putin made it very clear that any US-led attack in Syria would be perceived by the Kremlin as a US-led attack against Russia itself. While the rest of the week will more than likely remain quiet from an economic perspective, it will, in all likelihood, be active on the geopolitical front.