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Gold & Silver Down After Bernanke’s Speech

May 22, 2013 at 21:07 by Vladimir Vyun

Gold and silver dropped today as Federal Reserve Chairman Ben Bernanke signaled that the US central bank may trim its quantitative easing program. Previously, the prices rallied as Bernanke spoke about the danger of premature ending of easing measures.

At first, the Chairman said:

Premature tightening of monetary policy could lead interest rates to rise temporarily but would also carry a substantial risk of slowing or ending the economic recovery and causing inflation to fall further.

Yet later Bernanke explained:

If we see continued improvement, and we have confidence that is going to be sustained, we could in the next few meetings take a step down in our pace of purchases.

The minutes of the last Fed’s meeting showed that policy makers were unsure about timing and conditions of an end to QE.

The accommodative measures were considered bullish for the precious metals. Consequently, the speculations about ending of stimulus drove the prices down.

June futures for delivery of gold dropped $13.10 (0.95 percent) to $1,364.50 per troy ounce as of 21:03 GMT on COMEX today. July contract for silver edged down $0.23 (1 percent) to $22.23 per ounce.

If you have any questions and comments on the commodities today, use the form below to reply.

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