Gold hopes for weekly advance. After climbing over $1,500 yesterday on mixed economic data from the U.S. in the morning and decidedly bleak Chinese economic data, the yellow metal dipped again closer to $1,490 this morning as the U.S. stock market regained some ground.
Gold still hoping for a weekly advance after data showed Chinese economic growth slowed to the most sluggish pace since the early 1990s. Meanwhile, the Brexit agreement reduced some of the uncertainty that has bolstered gold in recent weeks.
China’s economy grew 6.0% in the third quarter, below the 6.1% consensus estimate of economists surveyed by both Bloomberg and Reuters. But the indicator, seen as reflective of the trade war between the U.S. and China, may not be as significant if the U.S. and Chinese presidents sign a promised trade deal next month. Chinese industrial production beat estimates.
The negative economic report out of China and losses in the dollar, which traded near an eight-week low, boosted gold, while news of the Brexit accord pressured it. The U.K. and European Union reached an agreement to manage Britain’s departure from the bloc as scheduled on Oct. 31. But Prime Minister Boris Johnson still has to get the deal approved by Parliament and may struggle to reach a majority in the House of Commons by Saturday, when the vote is scheduled. If MPs reject his plan, legislation requires him to seek an extension from the EU to the end of January — something Johnson has sworn he won’t do.
Bullion rose 0.3% Thursday to settle at $1,498.30 an ounce on Comex. It has closed below the key $1,500 threshold for the past five days but was up 0.6% the first four days of the week. Currently, the December contract is at $1,496.60.
Investors are looking at economic data for signs on the health of the global economy and indictors about monetary policy from the U.S. Federal Reserve and other central banks.
U.S. initial jobless claims rose by 4,000 last week to 214,000, Labor Department data showed Thursday. Economists polled by Reuters had projected claims rising to 215,000.
The CME FedWatch Tool showed early Friday that 85% of investors think the Fed will reduce interest rates by 25 basis for a third consecutive time when policy makers meet on Oct. 30. The probability of no change was 15%.
Silver’s gains this week have outpaced gold’s. The metal increased 1.1% Thursday to settle at $17.61 an ounce on Comex. The December contract is up 1.4% for the first four days of the week and has advanced 3.6% so far in October.
Spot palladium dipped Thursday but is still up 3.6% for the week and touched a fresh high of $1,758.53 Thursday. Spot platinum was slightly higher Thursday and has fallen 0.9% so far this week.
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