Walter Pehowich is off today.
The Gold/Dollar seesaw ride continues. This morning, the U.S. Dollar index has softened and boosted gold.
Last week saw gold hitting recent highs then selling off as a stronger dollar hit a near 19 month high. Meanwhile, Palladium continues to have the upper hand among precious metals.
As we rapidly head toward the end of 2018, we embark on a week that’s packed with econonomic activity including the Fed’s last meeting of the year AND the final Triple Witching expirations on Friday.
Another rate hike from the Fed is generally expected to come out of Wednesday’s meeting. In fact, the CME Fed Watch tool currently has the odds of a rate hike at just over 78%. The inevitability of this raise is thought to be baked into the markets, so a big reaction is not expected.
The more interesting highlights from the Fed meeting could well be its outlook for 2019, which appears to be sprouting dovish plumage. The International Business Times polled several top analysts about the coming year. Their report, released today, includes these highlights:
- ING: “Even market participants have grown skeptical about the course of monetary policy in 2019. ING said Fed funds futures contracts suggest the market is no longer fully pricing even one hike in 2019.”
- Merrion Capital: “The global economic/geopolitical background is turning more negative as the days go by and the Fed is aware of this…The risks for 2019 are tilted to the downside, with the possibility that the US central bank could sit on the fence for the whole year.”
Walter will be back on Wednesday.
Have a wonderful Monday.
Disclaimer: This editorial has been prepared by a Dillon Gage Metals analyst 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.