Silver Price Falls on Fed Decision to Keep Interest Rates Unchanged

- May 3rd, 2017

The US Federal Reserve hinted that it may raise interest rates in June if the US economy improves.

The silver price fell 1.78 percent on Wednesday (May 3), reaching $16.47 per ounce, after the US Federal Reserve decided to leave interest rates unchanged at 0.75 to 1 percent.
The impact of the Fed’s decision rippled through the market — all major indexes lost points except the Dow Jones Industrial Average (INDEXDJX:.DJI), which saw a slight increase. It closed up 8.01 points, or 0.04 percent, at 20,957.9 points.
The S&P 500 (INDEXSP:.INX) dropped by 3.04 points, or 0.13 percent, to close at 2,388.13 points, while the NASDAQ Composite (INDEXNASDAQ:.IXIC) experienced its largest drop in three weeks, falling 22.82 points, or 0.37 percent, to reach 6,072.55 points. The S&P/TSX Composite Index (INDEXTSI:OSPTX) was down 76.51 points, or 0.49 percent, and closed at 5,543.14 points.

Will silver rebound?

Find out why in your free report.

A statement from the Federal Open Market Committee explains that although the labor market has strengthened, economic activity in the US has slowed. That said, committee members expect the slowdown to be “transitory.” Economic activity should expand at a moderate pace, while labor market conditions are seen building strength; inflation is expected to stabilize at around 2 percent over the medium term.
TD Senior Economist Michael Dolega said that moving forward, the Fed will be looking at Q2 data to determine if it will raise rates in the summer. 
“Should figures over the coming weeks confirm a rebound in consumer spending and inflation, we expect the Federal Reserve raise rates in June. Still, this is far from a done deal, and potential weakness could delay any hike further into the year,” Dolega commented.
According to the latest government estimates, the US economy grew by 0.7 percent during the January to March quarter, the poorest growth recorded in three years. Consumer spending stalled in March for the second straight month, and the Institute for Supply Management reported slower-than-anticipated growth in the manufacturing industry.
Don’t forget to follow us @INN_Resource for real-time news updates.
Securities Disclosure: I, Melissa Shaw, hold no direct investment interest in any company mentioned in this article.

Is it a good time to buy gold stocks?

Learn to profit from gold's low price this year!

Get the latest Silver Investing stock information

Get the latest information about companies associated with Silver Investing Delivered directly to your inbox.

Silver Investing

Select All
Select None

By selecting company or companies above, you are giving consent to receive email from those companies. And remember you can unsubscribe at any time

Leave a Reply

Your email address will not be published. Required fields are marked *