Industry Report
March 19, 2016
The Weekly Dig
Haywood Mining Team
Gold Regains Early-Week Losses as Rates Held Steady
§ Wednesday saw the Federal Reserve keep interest rates on hold as expected. Accompanying the Fed’s announcement, however, was a more cautious tone regarding both the U.S. and global economy; the Fed’s comments came despite recent data indicating that U.S. inflation may be on the rise, with core CPI rising 2.3% in the 12 months through February (the biggest increase in more than 3 years). In a statement following the decision, Janet Yellen suggested there was inadequate evidence to suggest that inflation has indeed accelerated. In response, the gold price and gold equities regained some of the losses incurred during the week; the price of gold fell to as low as $1,226 per ounce on Tuesday before recovering to finish at $1,256 (↑0.5%) per ounce on Friday, while the S&P/TSX Global Gold Index briefly fell below the 180 mark before recovering to finish at 189. Silver (↑2.1%), platinum (↑1%) and palladium (↑2.5%) also finished the week higher, closing at $15.84, $971 and $590 per ounce respectively. Base metal prices also rose, with copper (↑1.7%) and zinc (↑2.1%) were up, while lead (↓3%) and nickel (↓2%) finished lower at $0.82 and at $3.91 per pound. Uranium prices have rebounded slightly from new recent lows, with the UxC Broker Average (BAP) Price of uranium falling to $28.50 per pound last Friday but rising steadily this week; the progressive increase in the BAP during the week (↑3.5%, at $29.75/lb U3O8) significantly increases the probability of an increase in the more widely quoted and market-visible UxC Weekly Spot uranium price on March 21st, which sat at $28.75/lb at Monday March 14th. Finally, WTI crude prices broke through the $40 level this week for the first time since December, before settling at $39.30 per barrel.
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