Gold and silver are continuing to concede value today, though like it has been the whole week, losses are only slight. After precious metals made such substantial gains last week, it was only a matter of time before profit-taking and technical corrections became a factor weighing on the progress of gold and silver. Despite losses being posted for the last three trading sessions, it is still very clear that the gold and silver bulls still have the near-term momentum. As more worldwide investors become averse to risk, their money will begin more readily flowing out of assets like equities and into asset classes like commodities, specifically gold and silver.
A majority of this week has been quiet from an economic news standpoint, though today was a bit different thanks to a few reports from China and the United States.
Thursday’s Slate of Economic Data
Over the past two weeks, pieces of economic data with the ability to have a significant impact on the marketplace have been few and far between. While this much is still mostly true today, there were a bunch of economic reports made public in the United States worth paying attention to. Among these reports was the flash manufacturing PMI, the latest CPI, and real earnings reports. While some of these reports beat market expectations, others didn’t, and in the end these pieces of data ended up having a marginal impact on the marketplace. What might have pushed gold downward, however, was the upbeat weekly jobless claims report. For the first time in a few weeks, weekly jobless claims had decreased; a factor that boosted the USD and helped put pressure on precious metals.
In other news from around the world, China’s preliminary manufacturing PMI for February was reported as being even weaker than January’s reading. Compared to last month’s manufacturing PMI of 49.5, February’s preliminary reading came in at just barely over 48. As many of you are aware, any reading under 50 suggests that that sector of the economy is experiencing contraction. As is the case anytime poor economic news comes from the world’s largest consumer of precious metals, this report hurt gold and silver.
As we head into the final day of the week investors will be anxiously waiting to see if gold and silver can turn things around or if profit-taking will push metals even further downward.