Silver led industrial and precious metals lower on Wednesday as markets awaited the Federal Reserve announcement.
The iShares Silver Trust (SLV) fell 4% in afternoon trading while SPDR Gold Shares (GLD) was off about 2% following data pointing to slowing economies in the U.S. and China. [Copper ETF Drops to Lowest Since June 2010]
In gold ETFs, bullion holdings fell about 7% in April, the largest monthly decline on record, according to Bloomberg News. Gold’s price decline and investor redemptions erased nearly $18 billion of value from the funds.
The drop in gold ETF holdings “underscores how some investors have lost faith in gold as the traditional store of value, even as central banks print money on an unprecedented scale to boost growth,” Bloomberg reported. [Gold ETFs: Record Monthly Drop in Bullion Holdings]
The precious metal ETFs were falling one day after Arizona lawmakers approved a bill that would make gold and silver legal tender in the state if Governor Jan Brewer signs it.
Full disclosure: Tom Lydon’s clients own GLD and SLV.