The spot values of precious metals are continuing to move downward in dramatic fashion as of the first half of the day on Wednesday. This time, it is yesterday’s election results that are weighing so heavily on metals. Though midterm elections went more or less the way most people expected them to go, most people held their positions through the first few days of the week regardless.
Now, as we look ahead to the last two days of the week, it is more than likely that the marketplace will remain abuzz with activity. For one, tomorrow is scheduled to bring about the latest European Central Bank meeting, and a growing number of people are under the impression that the ECB will announce fresh quantitative easing measures. On Friday, the market’s attention will shift to the release of October’s US employment report. As it stands, if both days go as anticipated, precious metals will be put underneath even more selling pressure. Now sitting at multi-year lows, gold and silver are growing weaker by the day.
Election Results Favor Economic Growth, Businesses
Though many people overlook the midterm elections in the United States, they are always incredibly important, and this time around that proved to be the case. With many seats in the Senate seemingly up for grabs, and even more gubernatorial spots up in the air, there was a lot riding on yesterday’s election results. Now, less than a day after voting ceased, it is clear to see that the Republican party has seized control of both the Senate and the House. This fact caused the US Dollar as well as US equity markets to tick upward considerably.
Because Republicans are seen as being more business-friendly than Democrats, most investors are convinced that the US economy will only continue to grow when in the hands of Republicans. It will definitely be interesting to see what kind of impact yesterday’s elections have on the political sphere in the United States. Of course, because election results gave equities and the greenback a boost, it should come as no surprise that precious metals are continuing to move downward today.
Making matters worse is the fact that the price of crude oil is only continuing to depreciate, bringing all raw commodities down with it. Because the Dollar and commodities seem to have taken on a directly inverse correlation in recent weeks, it is going to be tough for gold and silver to bounce back from recent losses.