Gold headed for its third weekly advance and remained near a four-month high on a weaker dollar and subdued U.S. Treasury yields.
U.S. weekly initial jobless claims dropped more than economists had expected last week, according to data released Thursday by the Labor Department. Applications for new unemployment benefits reached 444,000 last week, a pandemic-era low and below the 452,000 consensus estimate by analysts surveyed by Dow Jones.
The bullish economic news made risk-off assets like gold less attractive to investors. The Standard & Poor’s 500 Index broke a three-day losing streak Thursday to climb 1%. But gold futures remained near a four-month high amid concerns about inflationary pressure. Gold is a traditional hedge against inflation.
Front-month gold futures rose 40 cents Thursday to settle at $1,881.90 an ounce on Comex as the June contract expired. It advanced 2.4% in the first four days of the week. Futures rose 3% in April after dropping in January, February and March. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the pandemic. The June contract is currently up $3.80 an ounce to $1,885.70 and the DG spot price is $1,888.10.
Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, gained 0.6% Thursday to 1,037.09 metric tons, Reuters reported.
Minutes of the last Federal Reserve policy meeting in April, which were released Wednesday, indicated the central bank could reconsider its easy monetary policy if the economy continues to improve rapidly from pandemic declines. Low interest rates are typically bullish for gold.
The COVID-19 virus has killed more than 3.43 million people worldwide and sickened 165.5 million. About 20% of the cases — and 17% of the deaths — are in the U.S. The country has more than 33 million cases, more than any other nation, though its proportion of both new cases and deaths has been declining as more Americans are vaccinated and other countries’ outbreaks worsen.
In upcoming economic news, U.S. home sales and manufacturing data are due out Friday.
Front-month silver futures rose 0.2% Thursday to settle at $28.07 an ounce on Comex, and the July contract jumped 2.6% in the first four days of the week. Silver rose 5.5% in April after dropping in February and March. It increased 47% in 2020. The July contract is currently up $0.058 to $28.125 and the DG spot price is $28.06.
Spot palladium lost 0.3% Thursday to $2,888.50 an ounce and is down 0.7% for the week. The metal jumped 12% last month amid strong industrial demand. Palladium also rose in February and March. It rallied 26% in 2020. Currently, the DG spot price is down $46.70 an ounce to $2,839.50.
Spot platinum rose 0.8% Thursday to $1,211.20 an ounce and retreated 1.6% so far this week. Platinum increased 0.8% in April after trading flat in March. The autocatalyst metal rose 11% in 2020. The current DG spot price is up $2.20 an ounce to $1,212.00.
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.