Gold and Silver Turn Lower After Fed Statement: GLD, SLV
German Chancellor Angela Merkel called for a more unified drive to spur economic growth in the euro zone on Tuesday, saying countries should link energy grids and trade expertise in labor law. Merkel has adamantly opposed economic stimulus programs meant to shore up the currency bloc, instead advocating fiscal discipline and stability as the key to ending the region’s debt crisis.
Investor Insights: Global Factors Hitting Gold and Silver.
However, with recession looming, many experts have criticized Merkel’s approach as not doing enough to create jobs and boost economic activity. In a speech following a briefing with Michael Sommer, head of the German Confederation of Trade Unions, Merkel acknowledged that, “Joblessness is still very high in parts of Europe,” and said that, to help growth, euro nations should step up their economic cooperation and swap experiences in labor legislation. Investments, especially in intelligent energy grids, and a linking of European energy markets, could also foster growth, she said.
Don’t Miss: Federal Reserve: Rates Remain the Same.
The Federal Reserve also reiterated its record low interest rate policy, while leaving the door open for more monetary easing in the future. “Strains in global financial markets continue to pose significant downside risks to the economic outlook,” the central bank said in its post meeting statement. In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined .77%, while the iShares Silver Trust (NYSEARCA:SLV) fell .82%. Gold miners (NYSEARCA:GDX) such as Barrick Gold (NYSE:ABX) and AngloGold Ashanti (NYSE:AU) declined more than 2%. Silver miners (NYSEARCA:SIL) such as Hecla Mining Co. (NYSE:HL) and First Majestic Silver (NYSE:AG) declined 1.91% and 3.85%, respectively.
Union officials told Reuters on Tuesday that Freeport McMoRan Copper & Gold (NYSE:FCX) and its Indonesian workers’ union are expected to sign a pay deal soon, which would end a three-month strike at the world’s largest copper mine. Shares traded down .52% before the closing bell.
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