Gold near $1,900 again this morning as rising COVID-19 cases weigh down vaccine optimism and increase the bullion’s safe haven appeal.
Inflation appears far from investors’ minds as the yellow metal had little reaction to this morning’s U.S. Labor Department report that showed mixed wholesale inflation pressures. The Producer Price Index (PPI) was up 0.3% in October, slightly beating the projected increase of 0.2%. Inflation is up 1.1% for the year.
Gold has flipped direction from the first four days of this week after kicking off the back-and-forth moves with a $100 drop on Monday as the broader market surged on hope of a new vaccine to protect against COVID-19. The news made gold less attractive as an alternative investment, but uncertainty returned as U.S. cases topped the 10 million threshold.
Gold futures rose 0.6% Thursday to settle at $1,873.30 an ounce on Comex, though the December contract fell 4% in the first four days of the week. Gold is up almost $350 — or 23% — so far this year as investors have flocked to gold because of uncertainty from the coronavirus pandemic and the economy. Currently, the December contract is $1,891.10 an ounce and the DG spot price is $1,893.90.
The U.S. reported more than 150,000 cases of COVID-19 Thursday, just eight days after the figure topped 100,000. Health experts urged the country to double down on precautions. Pfizer announced earlier this week that he had developed a vaccine that was 90% effective in trials.
The virus known as COVID-19 has killed 1.29 million people worldwide and sickened 52.6 million. Almost 20% of the cases — and 19% of the deaths — are in the U.S. The country has 10.5 million cases, more than any other nation.
Pandemic-related lockdowns have sent millions of Americans into unemployment. But weekly initial jobless claims beat expectations last week, showing 709,000 new claims, below the 740,000 forecast by Wall Street economists and an indication that the labor market is improving.
But Federal Reserve Chairman Jerome Powell said Thursday that the economy that we once new is probably a thing of the past. “We’re recovering, but to a different economy,” Powell said during a virtual panel discussion at the European Central Bank’s Forum on Central Banking.
Investors will look to producer price index and consumer sentiment index data due out Friday for further direction on the economy. Two Fed officials are also scheduled to speak.
Silver futures rose 0.2% Thursday to settle at $24.31 an ounce on Comex. The December contract plummeted 5.3% in the first four days of the week. The most active contract increased 0.6% in October. The December contract is back up to $24.820 currently and the DG spot prices is $24.76 an ounce.
Spot palladium increased 1.4% Thursday to $2,353.90 and was down 6.2% so far this week. It dropped 4.5% in October. Spot platinum advanced 1.7% Thursday to $887.60 an ounce. It decreased 1.4% so far this week and fell 6% in October. The DG spot price for palladium is currently down over $10 to $2,338.10 an ounce and platinum is up over $7 an ounce to $897.90.
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.