Gold holding steady above $1,780 an ounce after the release of very positive U.S. jobless claims and muted U.S. Q3 GDP growth. The yellow metal had dipped early Wednesday with strength in the dollar kept futures below the $1,800-an-ounce threshold.
The gross domestic product (GDP) increased from an initial estimate of 2% to 2.1% for the third quarter per the Commerce Dept. While on the positive side of the scales, this is well below the solid gains of 6.3% in the first quarter and 6.7% in the second.
Jobless claims in the U.S. plummeted to their lowest level in more than 52 years last week. This morning’s Labor Department report of 199,000 jobless last week handily beat the street’s estimates of 260,000 and well below the previous week’s 270,000 jobless number.
The dollar index was near a 16-month high as speculation mounted that the Federal Reserve will be forced to act sooner rather than later to normalize monetary policy to rein in soaring inflation. A stronger dollar makes gold more expensive for investors holding other currencies.
Investors will be watching Wednesday at 2 pm Eastern for the release of the minutes of the last meeting of Fed policy makers, which will be closely parsed for indications on the timetables for interest rate increases. Speculation of such a move to combat inflation has gained steam since Fed Chairman Jerome Powell was appointed this week to a second term at the helm of the central bank. U.S. consumer prices jumped 6.2% in October, the biggest increase in more than 30 years, the Labor Department reported last week.
Also scheduled Wednesday are data from the University of Michigan consumer sentiment index and personal spending for October. U.S. financial markets — including Comex — are closed Thursday for the Thanksgiving Day holiday.
February gold futures dropped 1.3% Tuesday to settle at $1,786.30 an ounce on Comex. The front-month contract, which rolled to February from December last week, retreated 3.7% in the first two days of the week. Gold advanced 1.5% in October after retreating 3.4% in September. The yellow metal is down 5.7% so far in 2021. The February contract is currently flat at $1,786.30 an ounce and the DG spot price is $1,781.70.
Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, rose 0.6% Tuesday to 991.11 metric tons, Reuters reported.
Platinum came under pressure after the World Platinum Council raised its forecast for a surplus of the metal this year and projected another big oversupply in 2022. Spot platinum decreased 4.6% Tuesday to $971.80 an ounce and is down 6.5% this week. The metal rose 6% in October after losing 5.3% in September. It’s down 9.5% so far this year. Currently, the DG spot price is up $6.60 an ounce to $975.00
March silver futures decreased 3.6% Tuesday to settle at $23.49 an ounce on Comex. The front-month contract, which rolled from December last week, lost 5.4% the first two days of this week. Silver rose 8.6% last month after dropping 8.2% in September, its fourth consecutive monthly decline. The metal is down 11% so far this year. Silver prices are tied to industrial demand. The March contract is up $0.113 (+0.48%) to $23.605 and the DG spot price is $23.56.
Spot palladium fell 5% Tuesday to $1,871.00 an ounce and tumbled 6.7% so far this week. It rallied 4.3% in October after declining 23% in September. It’s down 24% so far in 2021. The DG spot price is currently up $4.70 an ounce to $1,870.00.
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