Gold and silver are hovering just above their opening values on what is shaping up to be yet another slow day of trading. Due to today being New Years Eve trading volumes are once again expected and already turning out to be thinner than normal. Investors are going to be away from their offices yet again tomorrow which means that we will continue to see erratic price movements.
As we bring 2013 to a close and think about the approaching new year it is important to reflect on the year that has gone by as well as speculate with regard to precious metals' future.
Year In Review
You don't have to be a market analyst to know that precious metals have not fared well over the past 365 days. A turbulent year is an understatement as gold is poised to lose well over $400 in value while silver's spot price has been nearly cut in half.
One of the biggest and most recent reasons for gold and silver's decline is the Fed's recent decision to slash its Quantitative Easing monetary policy. This move was anticipated by the market for most of the year but did not actually take place until a few weeks ago. Since the decision by the Fed was made, investor appetite for risk has grown significantly, so much so that US stocks have been on a hot streak for the past three weeks or so. With investor risk-appetite climbing, the overall interest in safe-haven gold and silver has dropped off almost completely.
As we look ahead to 2014, the picture is not such a pleasant one for gold and silver. Rumors pointing to the possibility of further QE reductions are only stoking the fire that is investors allocating their funds to stocks. While the US stock markets' hot streaks may come to an end in the early parts of 2014, overall interest in safe-haven precious metals is not looking like it will pick up significantly anytime soon.