Gold Futures Market News and Commentary
Precious Metals Close Higher on Weak Stocks and a Weak Dollar
Jun Comex gold (GCM19) on Wednesday closed up +1.0 (+0.08%) and July silver closed up +0.039 (+0.27%). A weaker dollar Wednesday boosted precious metals prices as did a slide in stocks, which fueled safe-haven demand for precious metals. Stock prices retreated and precious metals rose Wednesday on fears of escalation of the U.S./China trade and tech war after a report said the U.S. was considering blacklisting Chinese video-surveillance firms. Silver prices also found support Wednesday on stronger-than-expected Japanese economic data after Japan Mar core machine orders unexpectedly rose +3.8% m/m, the biggest increase in 5 months and a positive factor for industrial metals demand. Gold also received a lift Wednesday on dovish comments from St. Louis Fed President Bullard (FOMC voter) who said he "wouldn't rule out" a Fed rate cut later this year. In addition, the higher risk of a no-deal Brexit is a supportive factor for gold as a safe-haven after UK Prime Minister May's revised Brexit plan on Tuesday was thoroughly panned by most MPs. The ongoing US/Chinese trade and tech conflict has boosted fund buying of gold as long gold positions in ETFs rose to a 2-week high Tuesday. However, concern the trade conflict will reduce global growth and demand for industrial metals has sparked fund liquidation of silver as long silver positions in ETFs fell to a 3-week low Tuesday. Gold prices fell back from their best levels on reduced inflation expectations that curb demand for gold as an inflation hedge after the 10-year T-note breakeven inflation rate on Wednesday fell to a 3-1/2 month low of 1.802%.
Jun Comex gold (GCM19) on Wednesday closed up +1.0 (+0.08%) and July silver closed up +0.039 (+0.27%). A weaker dollar Wednesday boosted precious metals prices as did a slide in stocks, which fueled safe-haven demand for precious metals. Stock prices retreated and precious metals rose Wednesday on fears of escalation of the U.S./China trade and tech war after a report said the U.S. was considering blacklisting Chinese video-surveillance firms. Silver prices also found support Wednesday on stronger-than-expected Japanese economic data after Japan Mar core machine orders unexpectedly rose +3.8% m/m, the biggest increase in 5 months and a positive factor for industrial metals demand. Gold also received a lift Wednesday on dovish comments from St. Louis Fed President Bullard (FOMC voter) who said he "wouldn't rule out" a Fed rate cut later this year. In addition, the higher risk of a no-deal Brexit is a supportive factor for gold as a safe-haven after UK Prime Minister May's revised Brexit plan on Tuesday was thoroughly panned by most MPs. The ongoing US/Chinese trade and tech conflict has boosted fund buying of gold as long gold positions in ETFs rose to a 2-week high Tuesday. However, concern the trade conflict will reduce global growth and demand for industrial metals has sparked fund liquidation of silver as long silver positions in ETFs fell to a 3-week low Tuesday. Gold prices fell back from their best levels on reduced inflation expectations that curb demand for gold as an inflation hedge after the 10-year T-note breakeven inflation rate on Wednesday fell to a 3-1/2 month low of 1.802%.
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