Daily Market Review February 01, 2017

Gold drops down at $ 1,205.90 (-5.30) per ounce today, Silver Price -$ 17.52 (-0.09), Dow Jones index drops up 19,959.19 (Today’s change 0.48%), Fed Report highlights and FOMC scheduled meeting today! Investors around the globe are looking forward to the preview results of the first FED meeting on Tuesday since President Trump took office. Also, FOMC will publish its first annual report today. Due to Trump’s announcement that he would likely replace the Fed Chairwoman Janet Yellen when her term of office expires in February 2018, a lot of investors are expecting the relationship between the Executive branch and the Fed is going to be very intense in the following months.

US Dollar updates:

Meanwhile, the Gold went back on Wednesday, the dollar firmed ahead, and recovered a little ground after recording its worst start to the year in three decades on concerns the United States was poised to ditch its two-decade-old "strong dollar" policy. The dollar index traded less than 0.3 percent above the previous day's seven-week low on Wednesday, while the euro traded down 0.3 percent on the day just below $1.08. This is not good news for the gold market, as the dollar hike may strengthen the confidence in the U.S. economy and its currency, which is gold's biggest rival.

New Fed and FOMC economic forecast:

The Fed and FOMC hold about eight regularly scheduled meetings during the year and others if required. FOMC annual report, providing the information about financial statements, statistical tables, and maps will be published on February, 1.   To summarize the Federal Reserve meeting, we can say most analytics are in wait-and-see mode on the Trump economy. They're clearly paying attention to the debate over fiscal policy but aren't ready to move forecasts yet until they have a clearer idea of what the president will do. The perspective that Fed's plan to raise rates three times, instead of two times, next year is highly possible. The election was the main difference for a market in 2016 and we like it or not Trump’s victory changed the market pulse. The final economic projections the Fed will release only in March. There are some good reasons to expect that Fed’s position after Trump’s decisions addressed to them will soften in 2017. This will be positive for the gold price. The experts say the technical situation in the gold market is different now. In 2015, sellers oversold gold. Meanwhile, in 2016 only 30 % was sold in the first half of the year. Even if gold dropped down in November 2016, it was still not oversold before the Fed's move in December. These expectations might be built on just predictions. But, it does not change a situation where the current sentiment towards gold is negative. We hope it may change later in 2017.  

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