As of the writing of this post early Monday morning, gold and silver spot values are trending downward. This week, though admittedly lacking in the economic data department, is set to bring about a lot of investor concern due to the upcoming Federal Open Market Committee meeting. The FOMC is expected to convene for their latest meeting tomorrow and Wednesday, and as per usual the market is paying extremely close attention.
Just like every other time, investors are anticipating that more information regarding interest rate hikes will be divulged in the wake of this week’s meeting. There is no surefire way of determining whether this week’s meeting will bring about more information regarding interest rates, but investors will be paying close attention nonetheless.
FOMC Meeting On the Horizon
As is always the case, this week’s FOMC meeting will be the number one concern for global investors. Though the FOMC’s monthly meetings are always a hotly contested topic, they are even more of a concern in recent history simply because of the expectation that they will be hiking US interest rates sometime in the near future. Of course, it has now been more than half a year that interest rate hikes have been making headlines, and thus far very little has happened to make one believe that rate hikes will be coming soon.
Still, the market will be taking into consideration the attitude and language of the FOMC and use that to hopefully garner a clearer image of when interest rates will be raised in the United States. As it stands right now, the US Dollar is making nice strides forward ahead of this week’s meeting, and that is causing gold and silver to continue to tick downward. For gold and silver, an announcement regarding when interest rates will be raised will likely not help their prospects at all. Still, with that being said, the market has now known about the possibility of interest rate hikes for some time now, so when they come, it is likely that investors will not be caught so off guard.
Gold’s Solid Last Week
In case you missed it, last week saw both gold and silver add a lot of value. Beginning on Monday and carrying on through Tuesday, both gold and silver were seen spiking as a result of bargain-hunting and increased safe-haven demand. Though the next three days saw mild chart consolidation par some of the early week’s gains, the week was still a win for precious metals.
Now, the real test will be to see if metals can withstand whatever it is that this week throws their way. Interest rate hike talks have not boded well for gold and silver up to this point, so there is very few who think that will change this time around. Still, we will keep a close eye on anything and everything stemming from the latest FOMC meeting, which will wrap up with a post-meeting press conference sometime Wednesday afternoon.