Gold and silver are both trading lower today, mostly thanks to profit-taking by investors who are cashing in on the last few weeks’ rally by precious metals. Profit-taking wasn’t the only factor working against gold and silver today either, because a stronger than expected piece of economic data hit the marketplace shortly after the opening bell rang in New York.
While today saw both metals decline slightly, the past few weeks have seen nothing but the opposite happen. With both gold and silver having been in good form since the beginning of January, many investors are beginning to wonder where the metals will head in the next few months.
Civil Unrest In Ukraine, Thailand Fuels Risk Aversion
Something that has been going on for a few months but didn’t really make headlines until last week was the civil unrest in Ukraine. Since this past November, Ukrainians have taken to the streets in the capital of Kiev in protest of former president Yanukovych’s decision to cut ties with the EU in exchange for an economic bailout from Russia. Beginning early last week, what were once civil protests quickly began deteriorating into what looked like all-out war between protesters and riot police. Now, the death toll from these clashes is over 100 and even though Yanukovych is on the run, the situation is far from resolved.
Thailand is seeing its fair share of civil unrest too, as political rivals have been clashing for the past few weeks. More recently, civilians have been caught in the crosshairs in a situation that seems to be deteriorating as fast as it did in Kiev. This ongoing violence in Europe and Asia is adding to the risk-averse attitude being more readily exhibited by global investors.
Finally, in news out of the United States, a report released earlier today showed that sales of new homes rose by nearly 10% in January. This is the best such increase in nearly a half decade and was news that boosted the USD. This was also good news for investors who have seen nothing but a bad run of form by recent US economic data.