Precious metals did not do much moving this week despite one or two fairly large news stories from across the world. While some may see little movement as a bad week for metals, the reality is that the past few weeks have been so tumultuous for gold and silver that little movement is a relief for many. A European Central Bank meeting yielded big news that, for once, made Europeans happy.
Little Movement
Monday and Tuesday’s spot values had investors thinking that this week was going to repeat last week as far as gains go, but Wednesday seemed to dampen that thought a bit. By the time Thursday rolled around gold was trading at roughly the same price it was on Monday while silver had dropped below its weekly starting point a bit.
With much of Asia observing a holiday during the midweek trading from that part of the world was largely subdued. Whenever Asia is taken out of the market equation it usually spells bad news for precious metals spot prices just as it did this time. Asia is a part of the world that sees more demand for gold and silver than almost any other and because of the decline in value of gold and silver, demand has been up. Next week it is expected that the Asian demand will be back in full force and precious metals will likely benefit from that fact as far as spot values are concerned.
ECB Meeting
The European Central Bank had a meeting this week to discuss the financial future of the region and the conclusion of it was a solution that many were happy about. It was announced that interest rates will be cut by a quarter of one percentage point to sit at .5%. This was a fairly drastic, yet needed, decision in the wake of what has been an absolutely terrible last year of economic and financial data.
More recently, the manufacturing data and retail sales in Europe have been suppressed and with so many countries running into financial difficulties something had to be done. It is thought that the lowered interest rates will help boost European economies, but it is difficult to say for certain.
Moving Ahead
As we move into the first full week of May, one of the major headlines to follow is definitely the ongoing situation in Europe. While this upcoming week is a small sample size for judging the effectiveness of the reduced interest rates, it will be intriguing to see how investors react. It is anticipated that economic numbers will bounce back soon, but that is by no means a guarantee.
Weekly Move
Gold started the week at $1,466 and ended at $1,469. This was a gain of about 3 dollars. Silver started the week at $24.11 and by the time trading was done on Friday the spot value was at about $24.10. This was a loss of one single cent.