November 6th Silver Market Update

Gold and silver spot values have been moving downward all week long, and today is no exception. Over the course of the past two weeks or so, both gold and silver have depreciated significantly and are both currently sitting at or near massive multi-year lows. While the first few days of this week were generally quiet, things really began to pick up on Wednesday as we saw reaction to Tuesday’s US midterm election results. The Republicans, which are seen as more pro-business and better for the economy than Democrats, took control of both the House and the Senate, and stocks as well as the US Dollar reacted accordingly.

Today, investors do not have even a moment to relax due to the meeting of the European Central Bank. Because of the incredibly poor data that has been streaming out of the EU lately, including a 5-year German bond auction yesterday that fetched all-time record low average yields, most investors are expecting the ECB to make some sort of policy shift in order to more effectively spur economic growth. Whether that proves to be the case or not, however, is still very much up in the air at this point.

ECB Meeting Mostly Lackluster

The European Central Bank meeting that kicked off and wrapped up today did not bring about any groundbreaking announcements from president Mario Draghi. Even in the midst of a slumping economy that is on the verge of recession, Draghi remained calm. He seemed mildly worried about the strength of the EU economy, but did say that policy makers will be standing by at the ready with stimulus measures, should they be needed.

Now, the attention of the marketplace will shift back to the United States, which is set to release its latest employment data from October sometime tomorrow. As it stands, the expectations of experts are for figures that show somewhere in the neighborhood of 230,000 new jobs having been added to the economy last month. These expectations may seem like they are on the high side of things, but after last month’s growth absolutely dismantled expectations for only 215,000 new jobs being added to the economy, it only makes sense that the experts are expecting to hear of extremely positive job growth.

For gold and silver, an employment report that falls in line with current expectations will likely translate into even more selling pressure. At present, the market is really turning bearish, and as risk-appetite being exhibited by investors grows, demand for safe-haven gold and silver will likely continue to sink. For that reason and many more, the next few weeks will be vitally important in determining the long-term trend of metals.