Gold Extends Losing Streak, Silver Edges Higher
Gold fell for the third consecutive day as the U.S. dollar (NYSE:UUP) edged higher against the euro. According to the Commerce Department, the gross domestic product increased at an annual rate of 3 percent. The rate was below economists’ expectations of 3.2 percent, but it was the fastest pace since the second quarter of 2010. However, growth for the current first quarter is only expected to be around 2 percent.
Don’t Miss: Why Do Investors HATE These Stocks?
Growth concerns in Spain are rising as the country prepares to present its first budget on Friday. The fourth-largest economy in the euro zone is expected to implement austerity measures. According to a research note at Barclays Capital, “Now it is crunch time for the Spanish government, the countdown to convince the markets that Spain is fully committed to execute a fiscal plan consistent with the very ambitious fiscal deficit targets has effectively begun.”
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) edged .36 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) traded flat. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and Goldcorp Inc. (NYSE:GG) both declined more than 1 percent. Silver investments such as Silvercorp Metals Inc. (NYSE:SVM) and Silver Wheaton (NYSE:SLW) climbed .60 percent and .87 percent higher.
Due to a decline in expectations of more stimulus from the Federal Reserve, UBS AG (NYSE:UBS) cut its full-year gold forecast from $2,050 to $1,680 per ounce. According to Bloomberg, UBS explained, “The view that the U.S. economic recovery is looking more sustainable is becoming increasingly accepted. Gold is at risk, for it needs persistent inflows of investor money to keep it on its upward trajectory.”
Investor Insight: Will Monetary Policy and Inflation Continue to Support Gold?
If you would like to receive professional analysis on equity miners and other precious metal investments, we invite you to try our premium service free for 14 days.
Disclosure: Long EXK, AG, HL, PHYS
To contact the reporter on this story: Eric McWhinnie at email@example.com
To contact the editor responsible for this story: Damien Hoffman at firstname.lastname@example.org