Gold and silver were feeling pressure for a majority of the day on what proved to be a busier than normal Wednesday. In addition to the 1st-quarter GDP report for the United States, the latest FOMC meeting wrapped up this afternoon and yielded yet another change to monetary policy. In addition to this week’s boatload of economic data, investors are still continuing to pay attention to the situation in Ukraine. Violence has not really escalated too dramatically this week, but it has done little in the way of declining.
Plethora of Economic Data On The Slate This Week
There is a lot of economic data due out this week from, not only the United States, but around the world as well. One of the more important pieces of data was released today in the form of the first quarter GDP report for the United States. Market analysts were expecting to see year on year GPD rise by more than a full percentage point, but were instead greeted by a report that showed a marginal annual gain of only .1%. While this type of sub-par data would normally spark buying interest in precious metals, such was not the case this time around as most investors simply held their positions and waited to see what the FOMC had to say after this week’s meeting.
When the FOMC meeting finally concluded, the market got yet another $10 billion reduction to Quantitative Easing, though this was widely expected. Unfortunately for precious metals, however, the newest reduction to QE hurt spot values much more than it helped them.
As we look ahead to the last few days of the week investors are preparing to see both a manufacturing report out of China as well as the US Labor Department’s jobs data from April. As it stands, the market is expecting to see April non-farm payroll growth somewhere in the neighborhood of 200,000, though no one is really holding their breath with regard to that expectation. Investors aren’t really expecting to hear much positive news as a result of tomorrow’s manufacturing report from China either. Recent economic reports from China have been sub-par at best despite a very recent report that China is set to surpass the United States as far as economic strength is concerned sometime later this year.