Precious metals markets got hit this week as the Federal Reserve threw cold water on the idea of interest rate cuts.

Fed policy makers met on Wednesday and left their benchmark rate unchanged as expected. The Fed’s statement noted that price inflation excluding food and energy has declined over the past 12 months and is officially running below 2%. This, even as oil and gasoline prices have trended sharply higher this year.

Fed chairman Jerome Powell described the below-target official inflation number as “transitory.” He indicated he expects inflation to return to target at 2% without more central bank stimulus.

Powell’s comments disappointed investors who were hoping for a rate cut later this year. Equity markets joined metals markets in selling off.

For the week, gold prices are down 0.3% and currently come in at $1,283 an ounce. Silver is posting a weekly decline of 1.0% as spot prices trade at $14.98. Although they are bouncing back a little bit here today both gold and silver are at risk of closing out the week below some significant support levels, which could bode poorly for the near term outlook.

Platinum’s recent run higher got dealt a huge setback this week, with prices dropping $30 an ounce or 3.3% to now trade at $872 per ounce. And finally, palladium is also getting hit hard, down 4.3% since last Friday to trade at $1,372 as of this Friday morning recording.

Market volatility around FOMC meetings is to be expected. Unfortunately, traders still key heavily off the policies and pronouncements of central planners. To what extent central planners intervene directly in markets has long been a concern of sound money advocates.

The Gold Anti-Trust Action Committee, also known as GATA, has assembled massive amounts of circumstantial evidence of manipulation in the precious metals markets. Sometimes the evidence is clear cut – as when traders at major banks are found guilty of cheating the system. In other cases, there are dots yet to be connected.

The Federal Reserve is notoriously secretive, and the Treasury Department is also tight lipped about how and when it intervenes in markets. Those of us who think it’s important to shed light on these activities have very few allies in Congress.

One is Representative Alex Mooney, a Republican of West Virginia. Chris Powell of GATA recently appeared on USA Watchdog to give an update on some of Representative Mooney’s efforts.

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