Daily Market Update 3/28/11

GOLD
Gold today closed at $1,422, down $8.40 for the day. Stronger-than expected economic growth in the fourth quarter in the United States, coupled with hawkish comments from some U.S. Federal Reserve officials that the Fed was unlikely to extend its bond purchase program, pressured Gold prices. A 14% increase in the first two months of 2011 for Russian gold production is also a bearish factor.  Gold could soon return to its bullish march as global geopolitical tensions and European debt crisis remain headline news.

SILVER
Silver dropped $0.22 today, closing at $37.04 on light trading.

The Silver Institute reported today the amount of silver used for industrial purposes is forecast to rise to 665.9 million troy ounces by 2015, which would be a 36% increase from the 487 million used in 2010. The report identifies 11 still-new applications for silver, ranging from food packaging to radio identification tags to auto catalysts, which collectively could exceed 40 million ounces of industrial demand by 2015, said the Silver Institute. The report also said that stronger silver industrial demand in the U.S. and Asia will be a key factor driving growth through 2015, with healthy developing-country demand especially in markets such as China and India.

Today’s Important News           

• In elections over the weekend, German Chancellor Merkel lost control of the Baden Wuerttemberg state to the Green party. Merkel’s political party losing control hasn’t happened in the past 60 years.  Many political analysts believe it is less likely that Germany would support a Euro Zone bailout for Portugal, Spain or Greece.
• Pending home sales rose in February in all parts of the U.S. except for the Northeast, a real estate trade group reported Monday. The National Association of Realtors said its index of pending home sales rose 2.1% to 90.8 in February, the first increase in three months. Yet the index still stands 8.2% below the year-ago level of 98.9, when a now-expired federal tax credit boosted sales.

I’m heading to Baltimore tomorrow am for a special Gold & Silver PAC fund Raiser for Congressman Lamar Smith. As chairman of our industries Political Action Committee I am proud that we are taking an active role in monitoring, endorsing, and financially supporting Federal legislators that understand and support the rare coin and precious metal community.