Gold and silver are hovering around even in the early parts of Tuesday as the marketplace is gearing up for the release of a few US economic reports today. In older news, an Iranian nuclear agreement was reached this weekend, a deal that flipped the precious metals marketplace on its head only a day ago.
Though stock markets performed incredibly well on Monday, today is shaping up to be an uneventful day for the most part.
Iranian Nuclear Deal a Success to Some
Newly elected Iranian President Hassan Rouhani is hailing the deal reached by his nation and 6 of the world’s most influential countries as a success. The interim, 6-month agreement allows Iran to enrich uranium for strictly peaceful purposes in exchange for economic sanctions on the country being lifted. Despite the fact that Iran has consistently claimed its nuclear ambitions are strictly peaceful, up until recently no one in the West was willing to take Iran for its word. Instead, the West levied economic sanctions against the country as punishment for their defiant pursuit of nuclear power. Now, Iran will see over $7 billion in frozen cash returned to the nation over the next half year along with other freedoms with regard to the aviation and automotive industries in the country.
More recently, the tone of Iran nuclear talks began to change when Rouhani announced that he would like to sit down with Western leaders and reach some sort of agreement that would be acceptable for everyone; not solely the West. This past weekend exactly that happened when leaders from Russia, the US, France, China, the UK, and Germany sat down with Iranian leaders to talk about Iran’s nuclear ambitions. The result of the meeting was a 6-month temporary deal that will see Iran’s nuclear program opened to heavy international inspection and regulation in exchange for the lifting of economic sanctions and the allowance of Iran to pursue nuclear energy, and only nuclear energy. The purpose of the temporary agreement is to allow diplomats enough time to draft a long-term deal acceptable by everyone involved.
Most of the world is touting this agreement as a positive event simply due to the fact that supposed tensions between Iran and the US/Europe are on the decline. Israel, on the other hand, is hailing this deal as a mistake as the Israelis see Iran having any nuclear capabilities as a threat to their sovereignty. Gold and silver lost value in the immediate aftermath of the deal simply because decreased tensions in the Middle East mean that safe-haven purchases of precious metals are going to begin evaporating. While gold dipped to a 5-month low in the early morning hours of yesterday, the market was able to correct itself by the end of the day.
It is likely that this deal and the attempt to draft a permanent nuclear deal with Iran will be poking its head in the news quite regularly over the next few months. The biggest US economic report due out today is the latest retail sales report, though it is not looking like it will have too much of an impact on gold and silver spot values.
