It’s been another interesting week for the gold market. Reports on Syria and recent economic data have both had a pull on the yellow metal. Here is a look at this week in gold and what’s to come.
Economic Data Spawns Tapering Worries
New job data released at the end of the week showed that job growth in the US has been slower than expected. This has sparked worries that the Federal Reserve may hold off on the mid-September timetable to begin tapering the bond-buying program. Now investors are cautious as to when exactly the Federal Reserve will take action. A recent article by Bloomberg stated:
The payroll data “are surprisingly soft compared to where expectations have been trending — it’s still a soft recovery,” said Kathy Jones, a New York-based fixed-income strategist at Charles Schwab & Co., which has $2.12 trillion in client assets. “This has to give them a bit of pause. Coming into this, I thought tapering was a done deal.”
Now it seems that when policy makers meet on September 17th-18th that nothing is set in stone. This recent data has investors uncertain if the Fed will go through with its plans to begin tapering after all.
No Strikes against Syria?
Traders recently saw a jump in gold prices from the turmoil in Syria. Now it seems that international tensions have lightened up. Whether the military will actually strike against Syria still remains to be seen. International conflicts are traditionally good news for safe haven investments like gold and silver. As these tensions ease, it makes it difficult to know exactly how the gold market will respond.
According to a majority of survey participants in the weekly Kitco News Gold Survey, gold prices may be looking up next week. Out of 20 participants consisting of bullion dealers, investment banks and future traders – 13 participants see prices up next week. Many feel the uncertainty over when the Fed will begin tapering as well as issues with Syria are indicative that gold still has room for growth.
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