July 16th Early Week Silver Market Update

Gold and silver began Tuesday in much better position than they were at the end of the day on Monday. Some factors that helped gold and silver gain value on Tuesday were higher crude oil prices coupled with a lower US Dollar Index. While gold and silver likely won’t gain too much value on Tuesday due to most investors awaiting Wednesday’s speech by Ben Bernanke, the atmosphere is shaping up nicely for both gold and silver.

There is a bit of economic data due out of the United States on Tuesday including retail reports, CPI report, and the latest housing market index. As of now there are no big surprises to be expected from this data and for this reason most investors will be holding their positions in order to wait and see what Ben Bernanke has to say tomorrow.

Bernanke to Address the House

The most attention-grabbing story of the week has got to be Federal Reserve Chairman Ben Bernanke’s speech that he is to deliver to the US House of Representatives sometime tomorrow. The address will focus around the current state of the economy as well as the future of monetary policy in the United States. Unless you have been living under a rock you are likely well aware that US monetary policy has been at the epicenter of a lot of debate over the past few months.

At this point the popular belief is that the Fed will do away with their Quantitative Easing program by the end of 2013, and some folks even think that this could be done as soon as September. Up to now, most of the speculation about QE and monetary policy in general is exactly that, speculation. Investors are hoping that Bernanke’s speech will shed some further light on when and how QE will be done away with or wound down.

Other World News

Spot values of both gold and silver have been subdued for a while not, and more often than not when this happens bargain hunters come out in droves in order to purchase the metals at a perceived bargain price. While that was true during the massive dip in value we saw precious metals undergo during the Spring, such has not been the case this time around. Demand for physical gold and silver is weak in places where it would be expected to be strong, such as India, China, and Japan. This was true up until very recently as a new report indicates that demand for physical precious metals out of Asia is on the upswing. This increased demand stands the chance to further boost the spot values of both gold and silver in the coming weeks.

If you have paid attention to world economies lately you are likely well aware that the economies that comprise the European Union have not been doing so well. That sentiment is continuing as the latest report out of the region has indicated that both exports and imports are on the decline. This means that the EU could experience economic contraction for another consecutive quarter. I sound like a broken record but it really is about time that European leaders step up and actually make an attempt to correct their continent’s many mounting financial and economic problems.

Posted in Market News

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