Week of October 7th Silver Market Update

Precious metals have rebounded through the first two days of this week despite suffering significant losses towards the end of last week’s 5-day trading session. The early stages of this week have been uneventful, but tomorrow will see the marketplace host more activity simply because the latest minutes from the Federal Reserve’s most recent meeting are due to be released.

In case you missed it, last Friday brought about the most recent employment data from the United States, and what the report had to say came as a shock to many. In the lead-up to the report’s release, most were expecting to see job growth somewhere in the neighborhood of 215,000–a healthy number. In reality, however, the figures showed that nearly 250,000 new jobs were added to the economy. This astounding figure ended up giving US equities as well as the US Dollar significant boosts after both asset classes traded sideways for a majority of the week. Unfortunately, however, the progress made by equities and the Dollar was short-lived.

IMF Reduces Global Growth Forecast

The International Monetary Fund made public today a report indicating that global growth for this year may not be as great as they once thought it would be. According to the report, the IMF expects the global economy not to grow by 4% as was originally expected, but to rather grow by just about 3.8%. This reduction sent almost all global equity markets moving downward and did not do the USD any favors.

One bright spot to the report, however, is that the IMF is expecting US economic growth to exceed 2% this year; a number that beat previous expectations of a 1.7% year of growth.

In other news out of Europe, German factory output declined by about 4% in August and has not at all looked good in recent months. The market was expecting to see a decline somewhere in the neighborhood of 1.5%, so it is especially discouraging to see such a drastic movement downwards. This news also did not do world equities any favors, but did provide gold and silver with a bit of underlying support. Whether such support is here to stay or not, however, remains to be seen.

Now, the attention of the marketplace shifts to tomorrow’s release of the Federal Reserve’s latest minutes as they are sure to have some sort of impact on what moves investors make going forward.

Posted in Market Updates

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