Gold Down on Two-Decade High Dollar

Gold Down on Two-Decade High Dollar

Gold down on two-decade high dollar mark and treasuries soar, with 2-year Treasury yields hitting a 15-year high of 4.266% earlier in the session, supported by fears of an economic slowdown and declines in the broader market following the Federal Reserve’s rate decision Wednesday. Continue reading →

Gold Dips But Holds Above $1650

Gold Dips But Holds Above $1650

Gold dips on a stronger dollar, but holds the line above $1650 an ounce as investors awaited Wednesday’s meeting of Federal Reserve policymakers and anticipated another large interest rate increase to curb soaring inflation. Continue reading →

Gold Under Pressure As Dollar, Yields Surge

Gold Under Pressure As Dollar, Yields Surge

Gold under pressure as the dollar strengthens and U.S. 10-year Treasury yields surge to a 3-month high as investors bracing for another large interest rate hike next week by the Federal Reserve to stem soaring inflation.

An unexpectedly large inflation figure for August has sent financial markets roiling since Tuesday and boosted speculation that Fed policymakers may even consider a 100-basis-point increase in rates at their Sept. 21 meeting. Higher interest rates are typically bearish for gold, though the underlying inflation is traditionally bullish.

Front-month gold futures tumbled 1.9% Thursday to settle at $1,677.30 an ounce on Comex. Gold hit the lowest level since April 2020 in intraday trading. The December contract has declined 3% this week. Bullion dropped 3.1% in August after declining 1.4% in July. The metal retreated 3.5% in 2021. Currently, the December contract is down $9.3 (-0.55%)to $1668.00 and the DG spot price is $1661.50.

Investors are betting there’s a 24% chance of a 100-basis-point rate increase on Sept. 21, though none were projecting a move that large before the consumer price index report came out Tuesday, according to the CME FedWatch Tool. The remaining 76% of investors are predicting a 75-basis-point increase. A month ago, 59% had anticipated only a 50-basis-point increase amid speculation that the Fed’s previous rate hikes would have started to turn the inflationary tide. 

The Fed raised rates by 75 basis points each in June and July and has increased rates by 225 basis points this year to combat surging inflation. 

The U.S. consumer price index rose 0.1% in August from July, according to Labor Department data released Tuesday, after showing no change the prior month. The report crushed hopes that the Fed’s previous rate hikes had halted further increases in inflation, which was already at 40-year highs. The CPI climbed 8.3% from a year earlier, a slight slowdown, but the so-called core CPI, which strips out volatile energy and food costs, showed the first acceleration in six months.   

Equities also extended their decline as the dollar and Treasury yields held their strength in anticipation of an aggressive Fed move that could prove detrimental to economic growth. Strength in the dollar and Treasury yields is typically bearish for gold. 

Front-month silver futures dropped 1.5% Thursday to settle at $19.27 an ounce on Comex, though the December contract is up 2.7% in the first four days of the week after a large rally Monday. Silver tumbled 12% last month after slipping 0.8% in July. It retreated 12% in 2021. Silver prices are tied to industrial demand. The December contract is currently down $0.254 (-1.32%) to $19.015 and the DG spot price is $19.14.

Spot palladium decreased 1% Thursday to $2,168.00 an ounce. It’s down 1.8% so far this week. Palladium retreated 3.3% in August after rising 9.9% in July. It dropped 22% in 2021. The current DG spot price is down $43.10 an ounce to $2128.00

Spot platinum rose 40 cents Thursday to $917.80 an ounce and is up 2.9% this week. Platinum tumbled 6.1% in August after decreasing 0.3% in July. It fell 9.4% last year. The DG spot price is down $17.40 an ounce to $900.30.

 

Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.

Gold Working to Hold Above $1700

Gold Working to Hold Above $1700

Goldworking to hold above the $1700 line after dipping below that mark on Tuesday following an unexpectedly large inflation figure for August which sent the broader market tumbling and boosted speculation of a hefty interest rate hike next week by the Federal Reserve. The bullion getting a boost on Wednesday from a weakened dollar. Continue reading →

Gold Buoyed As Investors Buy the Dip

Gold Buoyed As Investors Buy the Dip

Gold buoyed as investors buy the dip and U.S. bond yields ebb, but the bullion is being kept in check by a stronger dollar and aggressive interest rate hike fears.

The dollar index jumped to a new 20-year high after a positive U.S. economic report made it more likely that the Federal Reserve will announce a large interest-rate hike at its meeting of policymakers later this month. The 30-year U.S. Treasury yield was near the highest level since 2014. 

Front-month gold futures fell 0.6% Tuesday to settle at $1,712.90 an ounce on Comex. U.S. financial markets were closed Monday for the Labor Day holiday, so there was no settlement. The December contract decreased 1.6% last week. Bullion dropped 3.1% in August after declining 1.4% in July. The metal retreated 3.5% in 2021. Currently, the December contract is up $9.9 (+0.58%) to 1722.80 and the DG spot price is $1713.30.

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.2% Tuesday to 971.05 metric tons from Friday, Reuters reported. 

Services PMI – an indicator of economic activity in the services sector – grew for a 27th straight month, according to data released Tuesday by the Institute for Supply Management. The Services PMI composite index came in at 56.9% in August, 0.2 percentage point higher than July’s 56.7%. It was the second consecutive monthly increase after three months of declines. 

Investors are now betting there’s a 74% chance of a 75-basis-point increase Sept. 21, with just 26% projecting a 50-basis-point rate hike, according the CME FedWatch Tool. The Fed raised rates by 75 basis points each in June and July and has increased rates by 225 basis points this year to combat surging inflation. 

While gold is a traditional hedge against inflation, the anticipated rate increases in response to it are bearish.

Investors will look to comments Wednesday from Cleveland Fed President Loretta Mester, Fed Vice Chair Lael Brainard and Fed Vice Chair for Bank Supervision Michael Barr for further direction. The Fed’s Beige Book – a report on the economic status in the central bank’s 12 regions – is also due out Wednesday. Fed Chairman Jerome Powell and Chicago Fed President Charles Evens are set to speak Thursday, the same day U.S. initial jobless claims come out. 

Front-month silver futures rose 0.2% Tuesday to settle at $17.91 an ounce on Comex. The December contract dropped 5% last week. Silver tumbled 12% last month after slipping 0.8% in July. It retreated 12% in 2021. Silver prices are tied to industrial demand. The December contract is up $0.322 (+1.80%) an ounce currently to $18.230 and the DG spot price is $18.37.

Spot palladium decreased 3.1% Tuesday to $1,989.00 an ounce. It fell 4.3% last week. Palladium retreated 3.3% in August after rising 9.9% in July. It dropped 22% in 2021. The current DG spot price is up $29.80 an ounce to $2036.00

Spot platinum gained 1.8% Tuesday to $860.20 an ounce. It dropped 3.2% last week. Platinum tumbled 6.1% in August after decreasing 0.3% in July. It fell 9.4% last year. Currently, the DG spot price is up $13.70 an ounce to $874.10.

 

Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.

Gold Near One-Month Low

Gold Near One-Month Low

Gold traded near a one-month low early Wednesday and looks headed for a fifth monthly drop on the prospect of higher interest rates.

Private payrolls showed anemic growth for August. Gold has shown little reaction to the ADP report that shows 132,000 new jobs for the month, a deceleration from the 270,000 gain in July and a far cry from the forecasted number of 300,000. The report also gave inflation worries a boost, showing annual pay up 7.6% for the month.

“We’re going to need to have restrictive policy for some time,” New York Federal Reserve President John Williams told the Wall Street Journal. “This is not something we’re going to do for a very short period and then change course.”

His comments echoed remarks Friday by Fed Chairman Jerome Powell, who indicated that the central bank will continue to act aggressively to fight four-decade highs in inflation.

Front-month gold futures fell 0.8% Tuesday to settle at $1,736.30 an ounce on Comex. The December contract also decreased 0.8% in the first two days of the week. Bullion is down 2.6% so far this month after dropping 1.4% in July. The metal retreated 3.5% in 2021. The current December contract is down $10.60 (-0.61%) an ounce to $1725.70 and the DG spot price is $1717.50.

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.44% Tuesday to 976.26 metric tons, Reuters reported. 

Investors are now betting there’s a 72.5% chance of a 75-basis-point increase next month, with just 27.5% projecting a 50-basis-point rate hike in September, according the CME FedWatch Tool. A week ago, 53% of investors were betting on a 50 basis point increase. The Fed raised rates by 75 basis points each in June and July. 

The market is awaiting a series of U.S. jobs reports, including the key U.S. employment report for August, set for release on Friday, for signals on the state of the economy and further direction. There has been some concern by investors that the aggressive Fed moves will hurt economic growth and could lead to a recession. But recent positive economic data have refuted many of those assumptions. 

U.S. jobs openings and consumer confidence both beat forecasts in reports released Tuesday, bolstering speculation that the Fed is clear to announce another big hike without damaging the economy. The Fed’s preferred inflation measure, the personal consumption expenditures price index, on Friday showed price pressures eased in July, though they remained elevated. 

The Cleveland Fed’s Loretta Mester and the Atlanta Fed’s Raphael Bostic are scheduled to speak Wednesday, and the ADP employment report for August and Chicago manufacturing PMI are due out. Thursday brings the key U.S. manufacturing report and weekly initial jobless claims, with the week ending with the monthly U.S. employment report Friday. 

Front-month silver futures retreated 2.1% Tuesday to settle at $18.29 an ounce on Comex. The December contract dropped 2.9% in the first two days of the week. Silver is down 9.5% this month after slipping 0.8% in July. It retreated 12% in 2021. Silver prices are tied to industrial demand. The December contract is currently down $0.292 (-1.60%) an ounce to $17.995 and the DG spot price is $18.22

Spot palladium slipped 2.4% Tuesday to $2,102.00 an ounce. It’s down 2% this week. Palladium is down 2.6% in August after rising 9.9% in July. It retreated 22% in 2021. Currently, the DG spot price is down $17.80 an ounce to $2090.00.

Spot platinum fell 2.5% Tuesday to $853.90 an ounce. It dropped 2.2% so far this week. Platinum has tumbled 5.8% in August after slipping 0.3% in July. It dropped 9.4% last year. The DG spot price is currently up $0.50 an ounce to $857.60.

 

Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.

Gold Clawing Back

Gold Clawing Back

Gold clawing back as investors step in to buy the dip and markets react to stressed world stock markets. The yellow metal had fallen early Monday, extending last week’s losses, as the dollar held near a two-decade high following hawkish comments Friday from Federal Reserve Chairman Jerome Powell. Continue reading →

Gold Down As Dollar Strengthens

Gold Down As Dollar Strengthens

Gold down, falling for a sixth session early Monday as the dollar strengthens, pressuring the precious metal amid expectations of a series of aggressive interest rates to rein in inflation.

The yellow metal touched its lowest level in more than three weeks Monday as the dollar rose to the highest level in more than a month, making gold more expensive for holders of other currencies. DG spot gold has clawed back to near $1,740, after hitting $1730, as traders buy the dip.

Investors are awaiting this week’s annual meeting of central bankers in Jackson Hole, Wyoming, for further indications on monetary policy. Fed Chairman Jerome Powell is set to speak Friday morning, while European Central Bank Executive Board member is set to speak Saturday. Bank of England Governor Andrew Bailey will also attend.

Front-month gold futures fell 2.9% last week to settle at $1,762.90 an ounce on Comex after the December contract decreased 0.5% Friday. Bullion dropped 1.4% in July after falling 2.2% in June and 3.3% in May, its worst month since September. The metal retreated 3.5% in 2021. Currently, the December contract is down $14.40 (-0.82%) an ounce to $1748.50 and the DG spot price is $1739.90.

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.32% Friday to 989.01 metric tons, Reuters reported.

Investors are now betting there’s a 54.5% chance of a 50-basis-point rate hike in September, with just 45.5% projecting a 75-basis-point increase, according to the CME FedWatch Tool. A month ago, 59.6% of investors anticipated a hike of 75-basis points or more. The Fed raised rates by 75 basis points each in June and July, though a few positive economic reports since then had triggered some speculation that the Fed might impose a smaller increase in September.

Richmond Fed President Thomas Barkin said Friday that the central bank would go as far as risking an economic recession to curb inflation.

The Fed’s Neel Kashkari is scheduled to speak Tuesday. And economic reports on durable goods, MBA mortgage applications, and pending home sales are due Wednesday. U.S. GDP and weekly initial jobless claims come out Thursday.

Front-month silver futures fell 8% last week to settle at $19.18 an ounce on Comex after the December contract tumbled 2% Friday. Silver slipped 0.8% in July after declining 6.2% in June and falling 6.1% in May. It retreated 12% in 2021. Silver prices are tied to industrial demand. The September contract is currently down $0.254 an ounce to $18.815 and the DG spot price is $18.96.

Spot palladium retreated 4.5% last week to $2,148.50 an ounce after falling 1.5% Friday. Palladium rose 9.9% in July after losing 2.9% in June and 14% in May, the biggest monthly decline since September. It retreated 22% in 2021. The current DG spot price is down $127.90 an ounce to $2021.00.

Spot platinum declined 7% last week to $901.80 an ounce after slipping 1.8% Friday. Platinum retreated 0.3% in July after losing 7.2% in June. It dropped 9.4% last year. The DG spot price is currently down $25.60 an ounce to $880.80.

 

Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.

Gold Slips ahead of Fed Minutes

Gold Slips Ahead of Fed Minutes

Gold slips ahead of Fed minutes, dipping on a stronger dollar, while shrugging off flat U.S. retail sales as investors awaited signals on the Federal Reserve’s likely future moves to combat inflation for further direction. Continue reading →

Gold Slips as Dollar Advances

Gold Slips as Dollar Advances

Gold slips as dollar advances early Monday and investors sought profits after the yellow metal advanced for a fourth consecutive week last week. The bullion was further suppressed by a downbeat economic report out of China. Continue reading →

Gold Rises on Recession Fears

Gold Rises on Recession Fears

Gold rises on recession fears, hitting a more than three-week high, after a report Thursday showed the U.S. economy unexpectedly contracted in the second quarter and Treasury yields touched a three-month low. The bullion had little reaction to this morning’s inflation data. Continue reading →

Gold Steady Heading for Weekly Gain

Gold Steady Heading for Weekly Gain

Gold steady heading for first weekly gain in six weeks boosting on the slump in U.S. Treasury yields, however the yellow metal is still pressured by the dollar that is trading near 20-year highs and an aggressive monetary policy expected to put a damper on inflation. Continue reading →

Gold Rises as Dollar Ebbs

Gold Rises as Dollar Ebbs

Gold rises as the dollar ebbs early Monday, with the yellow metal rebounding from its fifth weekly loss last week, as the dollar slides from 20-year highs and investors scaled back speculation that the Federal Reserve would boost interest rates by 1 percentage point at central bank policymakers’ meeting next week. Continue reading →

Gold Holds The Line Above $1,700

Gold Holds The Line Above $1,700

Gold holds the line above $1,700 as consumer spending data for June beats the street, even so the yellow metal looks headed for a fifth weekly loss Friday amid anticipation that the Federal Reserve will remain aggressive in tackling high inflation and the dollar hovered near 20-year highs. Continue reading →

Gold Clings to Sunday's Boost

Gold Clings to Sunday’s Boost

Gold clings to the Sunday’s boost resulting from the Group of Seven nations voting to ban new imports of bullion from Russia as a sanction of its invasion of Ukraine.

The U.S., U.K., Japan and Canada will pledge to halt new shipments of the yellow metal at a G-7 meeting this week, with the U.K. ban in particular set to largely shut Russian gold out of global markets because of London’s pivotal role in the international trade of the commodity. But uncertainty over whether the entire G-7 would act in concert as well as bearishness from last week due to pending interest rate hikes kept pressure on the precious metal.

August gold futures fell 0.6% last week to settle at $1,830.30 an ounce on Comex, though the front-month contract gained 50 cents Friday. Gold tumbled 3.3% in May, its worst month since September. It retreated 3.5% in 2021. The August contract is currently slightly down $0.70 (-0.04%) an ounce to $1,829.60 and the DG spot price is $1,830.10.

Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.2% Friday to 1,061.04 metric tons, Reuters reported.

Shipments of gold from Russia to London have already mostly dried up in the months since Russia’s invasion of Ukraine, particularly after the London Bullion Market Association removed Russian refiners from its accredited list in March.

A U.K. government statement foreshadowed the pending ban, while the U.S. Treasury Department was expected to issue one from Washington on Tuesday.

Separately, Russia defaulted on its foreign-currency sovereign debt for the first time since 1918, the year after the Communist revolution, amid crippling international sanctions.

Gold has also had some support from the ongoing pandemic and economic uncertainty. The International Monetary Fund slashed its U.S. growth forecast for 2022 on Friday, though said the country would “narrowly” avoid a recession.

Meanwhile, the prospect of escalating interest rates has kept a lid on precious metals prices, as have strength in the dollar and Treasury yields. The Federal Reserve announced a 75-basis-point rate increase, its biggest since 1994, earlier this month to combat the highest U.S. inflation in 40 years. Most economists and investors now expect Fed policymakers to announce a series of sizeable interest-rate increases through the end of the year, including another 75-basis-point increase in July, according to the CME’s FedWatch Tool.

Investors will be closely watching for the release Thursday of the May core personal consumption expenditures index, the Fed’s favorite inflation gauge. GDP data come out Wednesday, and key manufacturing results are scheduled for Friday.

September silver futures decreased 2.4% last week to settle at $21.16 an ounce on Comex, though the front-month contract advanced 0.3% Friday. Silver dropped 6.1% in May after losing 8.2% in April. It retreated 12% in 2021. Silver prices are tied to industrial demand. The September contract is currently up $0.161 (+0.76%) an ounce to $21.320 and the DG spot price is $21.34.

Spot palladium rose 3.1% last week to $1,907.50 an ounce after gaining 1.7% Friday. The metal lost 14% in May, the biggest monthly decline since September. It retreated 22% in 2021. Currently, the DG spot price is up $45.70 an ounce to $1,945.00.

Spot platinum tumbled 2.6% last week to $917.30 an ounce, though it increased 0.3% Friday. It gained 2.3% last month and lost 9.4% last year. The DG spot price is currently slightly down $2.50 an ounce to $915.20

 

Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or as a recommendation regarding any particular security, commodity or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand and accept this disclaimer.

Gold Steady ahead of Fed decision

Gold Steady ahead of Fed decision

Gold steady steady overnight ahead of this afternoon’s Fed decision. The yellow metal did get a small boost this morning from a surprise drop in U.S. retail sales. Investors now look toward today’s monetary policy announcement from the U.S. Federal Reserve, amid speculation about how aggressive the central bank will be in efforts to combat 40-year highs in inflation and stave off a potential recession. Continue reading →

Gold Yo-Yos After Hitting Five-Week Hig

Gold Yo-Yos After Hitting Five-Week High

Gold yo-yos after hitting five-week high in overnight trading, falling 1% Monday morning on stronger dollar and bond yields. The yellow metal had been boosted by speculation over a potential blow to the U.S. economy from an aggressive Federal Reserve approach to combating inflation. Investors worry last week’s report on the highest U.S. inflation since 1981 will force the Fed to take an even more aggressive monetary-policy stance than previously anticipated. Continue reading →

Gold Slips Off Inflation-Inspired Boost

Gold Slips Off Inflation-Inspired Boost

Gold slips off brief. inflation-inspired boost, settling back down to the level it hit early Friday as U.S. Treasury yields advanced ahead of the release of a key U.S. inflation report. The yellow metal briefly rose over $10 an ounce on the news that inflation hit 8.6% in May from a year ago. Continue reading →