Gold and silver are trading lower on Wednesday, mostly thanks to profit-taking by investors. Both metals have been on an upbeat run recently, thanks in large part to intensifying civil unrest in both Europe and Asia. While safe-haven demand for precious metals is still on the up and up, many are beginning to wonder just how long safe-haven demand alone will be able to push spot gold and silver forward.

Profit-taking isn’t the only factor weighing on precious metals spot values today, as a strong piece of US economic data released in the morning was also putting pressure on metals from the onset of the day.

Civil Unrest Threatens Stability In Ukraine, Thailand

Despite losses being recorded by both gold and silver today, recent days have provided a lot of fuel to the safe-haven demand fire. Making headlines early last week was the ongoing protests going on in Ukraine, many of which were beginning to take a turn for the worse. Now, the death toll in Ukraine has surpassed 100 and their former president, Viktor Yanukovych, is on the run, fleeing from Ukrainian warrants for his arrest. Though the violence has since calmed down a bit in Ukraine, the same cannot be said for Thailand, which is now seeing its own form of political violence. Though it is unclear how these two situations will be brought to an end, their continuance is adding a boost to the currently strong risk-averse attitude exhibited by investors.

Profit-taking began weighing on spot gold and silver as soon as the day began, but shortly thereafter yet another factor was pulling spot values down. A report with regard to new home sales in the US in January was made public early and showed an increase in new home sales better than any month on month increase we have seen in nearly a half decade. Statistically, sales of new homes rose by nearly 10% in January. Naturally, news this upbeat breaking a run of recently poor US economic data added to the value of the USD and detracted from the value of metals such as gold and silver.

As we move forward into 2014, it will be interesting to see how gold and silver carry on. So far, spot gold has gained a heft amount in 2014 with silver faring pretty well too, With risk-aversion on the rise the future looks bright, but there are a number of potential factors that can just as easily spell trouble for the commodities market, including increased tapering and a growth slowdown by the Chinese economy.

Gold and silver are trading slightly lower for a second consecutive day, though the amount of value both metals have lost is more or less negligible. This week is shaping up just like last week due to the lack of fundamental inputs making their way to the marketplace. Profit-taking and a slight technical correction are to blame for precious metals’ early week losses, though these two factors should be expected after the run gold and silver went on last week.

Despite this week lacking any noteworthy economic data from the US or elsewhere, today will be particularly important to investors due to the release of the latest FOMC minutes. As we move further into the month of February, it is becoming clear that commodities, especially gold and silver, have the near-term technical momentum.

Gold, Silver Continuing To Push Forward

Despite the last few days being somewhat negative for precious metals, the value they have lost due to profit-taking has been marginal to say the least. The reason for this is due to the growing risk-averse attitude exhibited by worldwide investors. So long as the investing world is actively seeking to mitigate risk within their investments, safe-haven demand for gold and silver will almost always grow, and grow rapidly. If you have a hard time believing this, all you have to do is take into consideration the fact that gold has gained more than $100/ounce since the turn of 2014. Not only has gold performed well, but silver too has made impressive strides forward thus far this year.

Today’s release of the latest FOMC minutes will be of vital importance to investors who are curious as to whether the tapering will continue or if the FOMC will temporarily pull the reigns on reducing their bond-buying. In all reality, the minutes will likely not provide much of any insight into what the FOMC plans on doing at their next meeting. Instead, I am expecting that today’s minutes will only see the Fed reiterate their positive outlook on the US economy.

In other news from around the world, violence between protesters and riot police is intensifying in the Ukrainian capital of Kiev. Since this past November, when Ukraine’s president, Viktor Yanukovych, made the decision to eliminate ties with the EU, protesters have been taking to the streets in opposition of this decision. While it may seem strange that Ukraine’s president voluntarily chose to essentially leave the EU, he did so in exchange for a Russian bailout of $15 billion. Many have opposed this decision since November, while others sympathize with the Ukrainian president and his stern decision-making in times of economic turmoil. Despite how you feel about the current situation in Ukraine, the fact of the matter is that any violence in an otherwise stable country will almost always translate into more safe-haven buying of precious metals.

Both gold and silver are showing signs of strength for the third consecutive day, as the US Dollar has been stopped in its tracks by the British Pound. Janet Yellen’s inaugural address to Congress is still catching the attention of the investing world, though the only real connections able to be drawn after her remarks yesterday was that she seems very similar to her predecessor, Ben Bernanke.

We are still seeing healthy safe-haven demand for gold and silver, but risk-appetite amongst investors may be on the rise in the wake of news that the US government may raise the debt ceiling without too much fuss from Democrats or Republicans. As it stands, gold is swiftly approaching the $1,300 threshold and is showing few signs of weakness.

Chinese Economic Data, BOE Outlook Upbeat

After a few weeks of consistently poor pieces of Chinese economic data, the marketplace was finally greeted with some good news in the early morning hours of Wednesday. A report with regard to Chinese exports claimed that January exports were up over 10% on an annual basis. Considering exports were only expected to have increased by about .1%, it is safe to say that many Chinese investors were pleasantly surprised. Chinese imports were also reported as being up over 10% in January, a number that also handily beat market expectations. These two reports coming from the economy that purchases more precious metals annually than anywhere else in the world works as a bullish factor for gold and silver.

Transitioning to the other side of the globe, the Bank of England increased its expectations for annual GDP growth today. The BOE officially increased their expected 2014 GDP growth from 2.8% to 3.4%. England’s central bank also announced that the unemployment rate is expected to drop to at or near 7%. If the unemployment rate does fall as expected, the BOE may finally be prompted to increase its interest rates. Towards the end of the summer, BOE head Mark Carney made it clear that requests to raise interest rates would not be entertained until the unemployment rate declines further.

Expect the duration of the week to be fairly quiet as far as trading activity is concerned, mostly due to a lack of any noteworthy economic reports from the US.

Gold and silver are once more trading up ahead of the all-important FOMC statement expected to be made sometime this afternoon. US stocks continue to slide as an increased amount of investors begin to come to terms with the fact that easy money in the US is on its way out. Moves by some foreign central banks to stabilize their currencies were made overnight and were met with a mixed reaction. In all, markets have calmed down in comparison to last Friday and the first two days of this week, but with the Fed’s statement this afternoon that all might change.

Easy Money On Its Way Out, Market Reacts

If you can recall back to December, the Federal Reserve of the United States made a landmark decision to pull the reigns on its longstanding monetary policy, also known as Quantitative Easing. The first decision to cut back on the policy saw bond-buying by the Fed be reduced by $10 billion per month. Now, barely a month later, the Fed is looking more and more like they are going to replicate December’s decision and cut back on QE by another $10 billion. This means that in the span of a little more than a month the QE policy of the United States has been decreased from $85 billion bond purchases per month down to $65 billion. While this is a significant decrease in monthly bond purchases, the moves made by the Fed are none too surprising as most of the market is and has been expecting to see QE reduced in some capacity. In all actuality, the life of QE as a whole is slowly being drained as many members of the Fed have made it clear that they would like to see QE completely abandoned by the end of 2014, so long as economic conditions permit.

All this taper talk is fine and good, but what does it mean for precious metals? At this point it is tough to say, but all signs are pointing towards the Fed’s tapering decisions being beneficial for gold and silver. The reason behind this is due to the fact that as more easy money flees the marketplace, liquidity not only in the US but around the world will begin to become an issue. As stocks become more difficult to cash in on investors will more readily seek out assets that are safe and reliable. To put it simply, safe-haven demand for gold and silver will rise as more investors cash in on stock gains and subsequently look to protect their money.

Coinciding with the decline of world stock markets is the pressure being placed on periphery currencies. The threat of more tapering in conjunction with recently poor economic data out of China is causing a massive sell-off of periphery currencies like the Turkish lira and the Indian rupee. In response to the early week sell off of mid-level currencies, central banks in Turkey, India, and South Africa have all raised their key lending rates in an effort to stave off deflation. As the day grinds on, the post-meeting statement by the Fed draws ever closer and is beginning to grip the world marketplace. Depending on what the Fed has to say, we may be in for an active afternoon and rest of the week.

Gold and silver are trading near even on Wednesday after both metals lost a good amount of value on Tuesday. This week has thus far been quiet on both the economic and geopolitical fronts around the globe. Japan’s central bank concluded their monthly meeting today but made no changes to their monetary policy.

The investing world is anxiously awaiting next week’s Federal Reserve policy meeting as it is seeming increasingly likely that the FOMC may taper QE by another $10 billion per month. As it stands, the Fed’s easy money policy sees $75 billion worth of bonds bought each month, down from $85 billion a month ago. The prospect of more tapering is currently weighing on the short-term and long-term prospects for gold and silver.

More Good News Out of Europe

The last few months have yielded little else besides positive economic data out of the European Union. What was once one of the hardest hit regions by the worldwide recession of 2008 is now an economic region growing at a high rate of speed. An early morning report out of Spain which said that demand for 10-year notes is on the rise added to recently strong EU economic data. To that end, yesterday yielded a similar report with regard to demand for bonds in Ireland and Portugal. This report was of particular interest to investors simply because the Irish and Portuguese economies were some of the mostly harshly effected by 2008′s recession.

So long as some of Europe’s smaller, weaker economies are able to continue to build upon recent successes the whole region will undoubtedly have a better year this year than they did in 2013. The strong data from the EU (and the US) is also translating into increased investor interest in European equities, of which have been on a solid bullish run of late.

In other news from around the world, China’s central bank recently decided to inject a cash stimulus into their economy. The central bank cited a need to ward off rising interest rates as well as a need to fulfill citizen cash requirements as reasons behind the stimulus. With the Lunar New Year scheduled to be celebrated at the end of the month the Chinese are requiring more cash in order to buy gifts, travel, and do just about anything else associated with the ages old holiday.

Gold and silver are trading slightly down for the second day in a row as most world stock indexes are reporting gains. Despite last week’s weaker than expected December jobs data from the United States, gold and silver were unable to sustain the momentum they were given on Friday. Wednesday was a mostly quiet day around the global trading atmosphere, but almost all movement posted by worldwide equity markets was upward.

Though there was not much US economic data on today’s slate, a retail sales report did well to rectify investor confidence in the US economy, of which was delivered a blow as an outcome of last week’s employment report.

World Bank Predicts Increased 2014 Growth, World Markets Respond Confidently

A few months ago it was reported that the World Bank predicted sub-par worldwide economic growth for this year. Though most regions of the world were expected to have a positive 2014, the level of growth predicted by the World Bank was unsatisfactory to some. Today, however, the World Bank more or less amended their earlier prediction by saying they expect a higher level of growth than previously thought. Most world stock indexes responded favorably today, exhibited perfectly by many European stocks hitting multi-year highs today.

In the United States, the monthly retail sales report released today was upbeat and encouraging to investors who were a bit skeptical of the US economy’s strength after last week’s employment data. The retail sales report boosted both US stock indexes as well as the US Dollar. As you could have probably guessed, all of this positive stock index action across the globe translated into selling pressure being levied against precious metals. Today is looking like it will effectively turn the tide of what was expected to be an upbeat week for precious metals. After last Friday’s gains by both gold and silver it seemed as though metals were gaining momentum, but as we have witnessed all too often over the past year or so, no gains made by gold and silver are guaranteed to be sustained.

Perhaps even more disheartening for precious metals investors was a report indicating that two voting members of the FOMC hope to see bond-buying, Quantitative Easing done away with by the end of 2014. If last December’s decision to taper QE is any indication of what might happen should future tapering measures be pursued, precious metals investors have good reason to worry. If you look at Europe and the United States over the last few months, the growing consensus is that easy money policies are no longer needed. The less cash that is being pumped into economies around the world by their governments, the more valuable paper currencies will become. As is almost always the case, stronger paper currency values translate directly into lower precious metals spot values.

Gold and silver have posted modest losses in the early parts of Wednesday as the USD is making some strong gains. Employment data out of the United States came back better than expected which put even more selling pressure on gold and silver. After making some decent gains through the first few days of the year precious metals have since began falling right back down towards low-points experienced towards the end of December.

Later this afternoon the latest FOMC minutes will be released for investors to mull over and speculate.

Stronger Dollar, Employment Data

In the early morning hours the USD rose to a month and a half high and began piling the pressure on precious metals before trading had even begun in the US. Through the morning the Dollar remains strong as gold and silver spot values decline further.

The ADP employment report for December was published today and came back beating market expectations. It was reported that nearly 240,000 jobs were added this past month, beating the 200,000 job increase that investors were expecting. This news prompted the US Dollar to gain even more value and seemed to have sealed the fate of precious metals for the day. The non-farm payrolls data scheduled to be published on Friday is also expected to see 200,000 non-farm jobs added a month ago, yet another sign that the overall US employment sector is gaining strength.

The Federal Open Market Committee minutes that are being released later today are of great importance to investors. This is so because everyone is hoping that the minutes will shed some more light on why the Fed decided to announce its QE tapering decision last month. Additionally, investors would also like to find out some more distinctive information with regard to whether or not the Fed plans on tapering QE further at any time during this year.

Also worth mentioning is the fact that the European Central Bank is scheduled to hold their monthly policy meeting tomorrow. At this juncture, no major policy changes are expected to come as a result of tomorrow’s meeting.

Gold and silver are both hovering around even as the market anxiously awaits the outcome of this week’s FOMC policy meeting. Though the meeting got underway a day ago, it won’t come to a conclusion until sometime this afternoon. While the meeting is officially absorbing the market’s attention, investors are really only waiting to hear what is said in the post-meeting statement.

With gold and silver having declined fairly steadily over the course of the past two weeks, it is no secret that the market thinks we will hear a Quantitative Easing tapering announcement as a result of this week’s meeting.

Markets Waiting Patiently for FOMC News

Even though the FOMC is still in the middle of their meeting, it seems as though the market has already decided what the outcome will be. The losses being posted by gold and silver over the last week or so are indicative of a market that is expecting to hear a tapering announcement sometime in the immediate future. For most, a tapering announcement is expected today, but there are still plenty of people who think a tapering announcement may not be made until sometime in 2014′s first quarter.

For those who are expecting to hear a tapering announcement today, their reasoning is fairly sound. Recently strong US economic data coupled with a quieter political atmosphere are two very good reasons why tapering may be announced later this afternoon.

Despite the increasing likelihood of a tapering announcement being made today, the once prevalent belief that tapering would cause gold and silver spot values to decline dramatically has subsided. This is the case because the market is expecting to hear a tapering announcement and so it will not come as a surprise when it happens. Because of this expectation, the investors who would have sold their precious metals holdings in the wake of tapered QE got a head start and sold off their metals beforehand. This occurrence is being perceived as the market already adjusting to tapered Quantitative Easing.

Nonetheless, investors the world over will patiently wait out these last few hours in hopes of hearing some sort of news with regard to Quantitative Easing and its likely reduction.

After a positive first two days of the week, gold and silver are both suffering a corrective pullback in the early morning hours of Wednesday. In a somewhat shocking turn of events, Democrats and Republicans were able to come together and form a finalized budget, a move that will see the US government avoid repeating a shutdown.

While this week is expected to be mostly quiet as far as economic data is concerned, next week’s FOMC policy meeting is quickly becoming the only thing on investors’ minds.

Shutdown Round 2…Avoided

In the early morning hours of Wednesday, major news outlets from around the United States were reporting on a finalized bipartisan agreement with regard to a government budget for this fiscal year. Thanks to the collaboration between Democrats and Republicans, the government shutdown we lived through a few months ago will not be repeated. Back when the temporary budget was accepted, many condemned its temporary nature simply because it meant that we ran the risk of repeating a shutdown only a few months down the road. While up until today it looked very much like we would be seeing another shutdown, lawmakers surprised everyone by setting aside their differences and coming to an agreement.

Even though the news of a budget agreement was unexpected and undoubtedly positive, markets did not react to it all that much. Now, US lawmakers have the fast-approaching debt ceiling to worry about as that temporary deal is set to run out soon as well.

China To Increase Economic Stimulus

In other news from around the world, it was reported that Chinese banks increased the amount of money they lent this past November. This news is being taken as a sign that Chinese officials are looking to continue to stimulate their economy, even though such a stimulus may see the large Asian nation flirt with widespread inflation.

As we look ahead to the end of the week, things are seeming like they will remain just as quiet as they were today. Investors are gearing up for the FOMC policy meeting which, at this point, is less than a week away.

Gold and silver both recorded positive gains on a day when economic data was adversarial to the spot values of precious metals. The first bit of economic data released this week came in the form of the ADP National Employment Report which came in much better than market expectations.

As we look ahead to tomorrow, both a US GDP report and European Central Bank meting will be catching the attention of investors. Though no major policy shifts are expected to come as a result of the ECB policy meeting, investors will want to hear what president Mario Draghi has to say about the ECB’s recent decision to cut its key lending rate. The GDP report is not being weighted as heavily as Friday’s US jobs data, but will be a point of interest for investors nonetheless.

Bargain-Hunting In Full Force

With gold opening the day at one of their lowest points in the last half year, it is no surprise that so many investors awoke today with bargain hunting on their mind. In fact, the intense amount of bargain-hunting buying going on today was enough to cancel out the downward pressure being placed on gold and silver as a result of the better than expected employment report.

Though gold and silver may not be able to maintain a positive run for the duration of the week, today’s gains were a nice respite from precious metal’s recently woeful run.

Upbeat ADP National Employment Report

Though investors are looking much more forward to Friday’s jobs data, today’s ADP national employment report caught the attention of some. Compared to market expectations of about a 170,000 rise in workers during November, the employment report showed that there was actually a 215,000 increase in the amount of workers added to the workforce.

Though this data works against the prospects of gold and silver, bargain-hunting was intense enough to cancel out any bearish pressure emitted from the employment report. Investors are gearing up for tomorrow’s ECB meeting as well as Friday’s jobs data, the latter of the two standing a good chance to alter the spot values of gold and silver.