Gold and Silver Fall After QE4 Announcement

  • Like on Facebook
  • Share on Google+
  • Share on LinkedIn

On Thursday, gold (NYSEARCA:GLD) futures for February delivery, the most active contract, declined $21.10 to settle at $1,696.80 per ounce, while silver (NYSEARCA:SLV) futures for March dropped $1.43 to close at $32.36.

Both precious metals suffered a pullback, despite the Federal Reserve announcing QE4  on Wednesday. The central bank said it will purchase $45 billion in long-term Treasuries each month, in addition to its previously announced QE-to-infinity-and-beyond that buys $40 billion in mortgage-backed securities each month.

Don’t Miss: Santa Bernanke Delivers Early Christmas

However, the lower prices are likely to attract gold bulls in various parts of the world. “Participants, especially in India and the Far East, are drawn in by the lower prices,” explained Marc Ground, a commodities strategist with Standard Bank, according to WSJ. “For Indian buyers in particular, this lower gold price has relieved some of the pressure of a weaker rupee and a higher interest rate environment-prompting them to return to the market, after being noticeably reticent this past year.”

By the end of the day, the SPDR Gold Trust (NYSEARCA:GLD) closed 0.84 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) fell 2.59 percent. Gold miners (NYSEARCA:GDX) such as Yamana Gold (NYSE:AUY) and Barrick Gold (NYSE:ABX) both declined more than 2 percent. Meanwhile, Silver Wheaton (NYSE:SLW) and Endeavour Silver (NYSE:EXK) plunged 3.13 percent and 4.06 percent, respectively.

Are you worried about QE4 and the Fiscal Cliff? Click here to get our Gold & Silver Premium Newsletter OVER 50% OFF now!

Disclosure: Long EXK, AG, HL, PHYS

More Articles About:

To contact the reporter on this story: staff.writers@wallstcheatsheet.com To contact the editor responsible for this story: editors@wallstcheatsheet.com

Yahoo Finance, Harvard Business Review, Market Watch, The Wall St. Journal, Financial Times, CNN Money, Fox Business