Both precious metals declined, as the U.S. dollar reached its highest level against the Japanese yen since April. Japan’s cabinet approved an economic stimulus plan before elections take place in December. Polls indicate that an opposition party, which is calling for unlimited monetary easing, will win the political race, according to Bloomberg.
“If the Bank of Japan is forced to become even looser, the yen will be potentially even weaker…being elected in December, they are not going to have the time to do anything really dramatic, except looser monetary policy.” The greenback has gained more than 3.0 percent against the yen in November, its biggest monthly gain since February. Year-to-date, the dollar has increased about 7.0 percent against the yen.
Gold closed the week 2.3 percent lower, but finished the month relatively flat. The price of silver declined 2.7 percent on the week, but logged a gain of 4.8 percent for the month.
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) fell 0.80 percent, while the iShares Silver Trust (NYSEARCA:SLV) dropped 2.70 percent. Gold miners (NYSEARCA:GDX) such as Yamana Gold (NYSE:AUY) and Barrick Gold (NYSE:ABX) both declined 1.70 percent. Silver names such as Silver Wheaton (NYSE:SLW) and Endeavour Silver (NYSE:EXK) also traded more than 1.0 percent into the red.
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Disclosure: Long EXK, AG, HL, PHYS