Gold retreats early Monday as traders awaited the Trump administration’s promised clarity about potential tariffs on the import of 100 ounce and 1 kilogram gold bars.
The White House said Friday it would address “misinformation” about gold bars facing tariffs – something first reported last week in The Financial Times. Gold futures closed at a record Friday but came off the highs after the government statement. The price differential between New York and London-traded gold also narrowed after widening on the initial levy news.
December gold futures rose 2.7% last week to settle at $3,491.30 an ounce on Comex after the front-month contract rallied 1.1% Friday. Bullion gained 1.2% in July after slipping 0.2% in June and losing 0.1% in May. It’s up 32% this year. The metal rose 27% in 2024, its biggest annual gain since 2010. The December contract is currently down $81.30 (-2.33%) an ounce to $3410.00 and the DG spot price is $3363.10.
“The White House intends to issue an executive order in the near future clarifying misinformation about the tariffing of gold bars and other specialty products,” CNBC quoted a White House official as saying late last week.
Previously, the Swiss Precious Metals Association said that U.S. Customs and Border Protection had indicated that gold bars would be subject to tariffs. Initial reports of the levy caused the premium for gold futures in the U.S. over the London market to widen.
Separately, investors are awaiting the release of key U.S. inflation reports this week for further direction. The consumer price index for July comes out Tuesday, followed by the producer price index on Thursday. Initial jobless claims are also due out Thursday. The Federal Reserve has said it closely watches inflation and jobs data when determining monetary policy.
Traders have been raising bets on an interest rate cut at Fed policymakers’ next meeting in September. Lower interest rates are typically bullish for gold, making it a more attractive alternate investment.
More than 86% of the investors tracked by the CME FedWatch Tool are now betting that the Fed will cut rates next month. The Fed has held rates unchanged at 4.25% to 4.50% all year, including at policymakers’ most recent meeting at the end of July. The central bank began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts last year.
Front-month silver futures increased 4.4% last week to settle at $38.54 an ounce on Comex after the most-active September contract gained 0.7% Friday. Silver rose 1.5% in July after increasing 9.5% in June and adding 0.6% in May. It rose 21% in 2024. The September contract is currently down $0.612 (-1.59%) an ounce to $37.930 and the DG spot price is $37.87.
Spot palladium decreased 6.4% last week to $1,140.00 an ounce after falling 1.4% Friday. Palladium climbed 8.8% in July after surging 14% in June and advancing 2.8% in May. Palladium dropped 17% last year. Currently, the DG spot price is up $16.60 an ounce to $1157.00.
Spot platinum rallied 2.1% last week to $1,339.10 an ounce, though it slipped $1.30 Friday. It dropped 3.9% in July after climbing 27% in June and rising 8.6% in May. Platinum lost 8.4% in 2024. The DG spot price is currently up $0.20 an ounce to $1333.80.
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 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.