Gold Droops This Morning

Gold Droops This Morning

Gold droops this morning as Treasury yields hold strength gained from last week’s economic data while investors wait for this week’s key U.S. inflation and retail sales numbers.

U.S. data released Friday showed that producer prices reached the highest level in 9.5 years in March. The producer price index exceeded expectations, rising 1% from February and 4.2% from a year earlier.

Front-month gold futures rose 1% last week to settle at $1,744.80 an ounce on Comex after the June contract slipped 0.8% Friday. It was the first weekly rally in three weeks. Futures slipped 0.8% in March after posting their worst month since 2016 in February. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the pandemic. Currently, the June contract is down $9.00 an ounce to $1,735.70 and the DG spot price is $1,738.80.

Meanwhile, Federal Reserve Chairman Jerome Powell said on a “60 Minutes” episode aired Sunday that the U.S. economy is at an “inflection point” to start growing rapidly and create more jobs after the downturn triggered by the COVID-19 pandemic. He cited vaccinations and strong monetary policy support. But he warned the public needs to do its part to keep the virus from spreading again.

The COVID-19 virus has killed almost 2.94 million people worldwide and sickened more than 136 million. About 23% of the cases — and 19% of the deaths — are in the U.S. The country has almost 31.2 million cases, more than any other nation. Pandemic restrictions have cost millions of people their jobs, with the latest U.S. initial jobless claims numbers unexpectedly rising again in the last report.

In upcoming economic news, the U.S. will release inflation data Tuesday, and Powell is set to appear on a panel Wednesday. The Beige Book — a snapshot of the economic situation by the Fed’s 12 regional banks, also comes out Wednesday. Initial jobless claims will be released Thursday. In China, economic growth, industrial production and retail sales figures are due Friday.

May silver futures increased 1.5% last week to settle at $25.33 an ounce on Comex. The contract declined 1% Friday. Silver dropped 7.2% in March after decreasing 1.8% in February, its first retreat in three months. It gained 1.9% in January and 47% in 2020. The May contract is currently off $0.220 an ounce to $25.105 and the DG spot price is $25.15.

Spot platinum retreated 0.4% last week to $1,212.70 an ounce after dropping 2% Friday. Platinum was flat in March after rallying 11% in February amid forecasts for higher demand and tighter supplies. The autocatalyst metal rose 0.5% in January and 11% in 2020. Currently, the DG spot price is down $25.00 to $1,188.50.

Spot palladium fell 0.3% last week to $2,663.50 an ounce, though it rose 0.2% Friday. Palladium advanced 13% in March. The metal gained 4.9% in February, plummeted 9% in January and rallied 26% in 2020. Palladium is currently up $14.00 an ounce with DG spot prices at $2,675.00.


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