Possible Sept. Rate Hike Suppresses Precious Metals

The Market Gage - Dillon Gage's Precious Metals Newsletter

Finally there is someone at the Fed that has some common sense…maybe?

Atlanta FED President Dennis Lockhart said today he would not discuss his opinion of what the U.S. central bank will likely do at its September, November, or December meetings as “financial markets seem to be very sensitive to remarks of Fed speakers at the moment.” Sounds great, I feel better.

What he did share was that he believed that recent economic data “warrant a serious discussion of a policy rate increase.”

Really, on what promising data did I miss?

So even though he said he wouldn’t give an opinion on what the Fed should do at the next three meetings, he’s thinking a rate hike might be appropriate?

Hold on, I’m scratching my head. Did we all get that? I need to read that a second time.

Today’s CME FED Watch tool predicts a 24 percent chance of a rate hike in September.

Looking at the markets this morning, all four metals are in negative territory. Platinum and Palladium are taking the biggest hit. Silver might have caught what Hillary has that has put it on the shelf for a few days. Gold’s recent bullish momentum seems to be fading away as we look to test the next level of support at $1,318 in the December contract.

Overall, the fear of a September hike has the precious metal market in a sell bias until the next Fed meeting (or next Fed comment).

Have a wonderful Monday.

Disclaimer: This editorial has been prepared by Walter Pehowich of Dillon Gage Metals. This document is for information and thought-provoking purposes only and does not purport to predict or forecast actual results. It is not, and should not be regarded as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein are current opinions as of the date appearing in this editorial only and are subject to change without notice and cannot be attributable to Dillon Gage. Reasonable people may disagree about the opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. All investments entail risks. There is no guarantee that investment strategies will achieve the desired results under all market conditions and each investor should evaluate its ability to invest for a long term especially during periods of a market downturn. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. This information is provided with the understanding that with respect to the opinions provided herein, that you will make your own independent decision with respect to any course of action in connection herewith and as to whether such course of action is appropriate or proper based on your own judgment, and that you are capable of understanding and assessing the merits of a course of action. You may not rely on the statements contained herein. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisors with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.