2017 is seeing the most heated tax debates in over three decades as Congress considers an upcoming tax bill. The US House of Representatives and the Senate are bouncing back and forth between their versions. Meanwhile, the current administration works on its plan. Varying points are being raised throughout, such as the corporate tax rate, income taxes, and exemptions. (to name a few). But how does all of this affect you and your gold and silver holdings?
Last week, the S&P 500 and the Dow finished at the lowest two weeks they’ve seen in three months. This rate wasn’t shockingly low. It was within approximately 1% of their highs. Yet, it did serve as a reminder for holders of the relationship between stocks and precious metals. If investors begin to flee the stock markets, it could result in a strengthening of precious metals. The next few days will be a good time to keep watch of the equity indexes.
For the last few months, speculation has said that if interest rates are pushed lower than the price of precious metals will rise alongside them. Some analysts are also predicting that gold volatility will remain low for now.
For now, it’s unclear how or if the tax reform will come through. Tensions between Republicans, Democrats, and even the president are at one of the highest levels we’ve seen. So, for now, we can’t necessarily count on a majority passing the bill at all. Wall Street is keeping a close eye on the proceedings.
This article is third-party analysis. It does not constitute any financial advice. Please consult a certified financial adviser.