Gold Rises On Uncertainty

Gold Rises On Uncertainty

Gold rises on uncertainty Monday morning as investors veer to safe haven assets while eyeing Tuesday’s U.S. presidential election.

Investors also awaited the key U.S. manufacturing report for October for signals on the health of the economy and further direction. China’s manufacturing report earlier Monday showed a sixth consecutive monthly expansion.

Gold futures fell 1.3% last week to settle at $1,879.90 an ounce on Comex even after the December contract rose 0.6% Friday. The yellow metal dropped 0.8% in October, its third consecutive monthly decline. The yellow metal is up more than $340 — 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 up over $10 an ounce to $1,891.00 and DG spot price is up to $1,892.40.

While former Vice President Joe Biden is projected to win the U.S. election, President Donald Trump may yet pull through in some key swing states. The results of the election — particularly if it’s close — may not come in for a few days, triggering concerns about unrest in the country.

But many investors are speculating that the end of the election cycle — regardless of who wins — is likely to bring a stimulus package to the U.S. that will weaken the dollar and be bullish for gold.

New lockdowns were imposed across Europe over the weekend, as the continent reached the milestone of 10 million coronavirus cases on Sunday. The virus known as COVID-19 has killed 1.2 million people worldwide and sickened 46.5 million. About 20% of the cases — and 19% of the deaths — are in the U.S. The country has 9.21 million cases, more than any other nation. Pandemic-related lockdowns have sent millions of Americans into unemployment.

In economic news, China’s Caixin/Markit Purchasing Managers Index on Monday came in at 53.6 for October, beating the 53.0 forecast by analysts in a Reuters survey. And over the weekend, China said its official manufacturing PMI for October had increased for an eighth consecutive month.

Later this week, U.S. Federal Reserve policy makers are scheduled to meet and announce a rate decision, and the key U.S. jobs report for October is scheduled to come out Friday.

Silver futures dropped 4.2% last week to settle at $23.65 an ounce on Comex, though the December contract gained 1.2% Friday. The most active contract increased 0.6% in October. The December contract is up over $0.33 an ounce to $23.980 and DG spot price for silver is up to $23.97.

Spot palladium fell 7.5% last week to $2,220.40 an ounce. It gained 0.7% Friday and dropped 4.5% in October. Spot platinum retreated 6.7% last week to $850.20 an ounce. It lost 0.6% Friday and decreased 6% in October. DG spot for platinum is currently up over $10 an ounce to $863.20 and palladium is up to $2,232.90.


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