Gold Slipped Earlier Monday

Gold Slipped Earlier Monday

Gold slipped earlier Monday to a one-week low amid signs that the U.S. and China were edging closer to a trade deal.

Equities and the dollar rallied, making gold less attractive as an alternative investment. Gold prices skyrocketed earlier this year as a hedge against uncertainty as the U.S.-China trade standoff worsened.

The Chinese government on Sunday called for stronger protections of intellectual property rights, addressing a key U.S. concern. U.S. President Donald Trump told “Fox and Friends” Friday that the two sides were “very close” to a phase one deal. And Chinese President Xi Jinping said Friday that his country wants to work toward a phase-one deal that’s based in part on “equality,” according to a Bloomberg report.

February gold futures settled unchanged at a one-week low of $1,470.50 an ounce Friday on Comex. Bullion was little changed on the week and is down 2.9% so far this month. Speculators boosted their bullish positions in Comex gold and silver contracts in the week ended Nov. 19, the weekly Commitments of Traders report from the Commodity Futures Trading Commission showed Friday.

The dollar rebounded Friday after a survey showed that U.S. manufacturing output accelerated in November to the fastest rate in seven months. Services activity beat expectations, rising to the highest level in four months

Investors continue to keep a close eye on economic news for indications on future Federal Reserve actions after the central bank cut rates for three consecutive times. The CME FedWatch Tool showed a 93.4% probability that the Federal Open Market Committee would keep rates unchanged at the next meeting Dec. 11, while there were 6.6% odds on a hike.

In economic news this week, Fed Chairman Jerome Powell is scheduled to speak Monday in Providence. U.S. consumer spending, GDP, jobless claims and durable goods data are due out Wednesday. U.S. financial markets are closed Thursday for the Thanksgiving Day holiday. China’s manufacturing PMI data comes out Friday.

Silver fell 0.4% Friday and fallen 5.1% so far this month. The most-active March contract settled at $17.15 an ounce Friday on Comex. Spot platinum and spot palladium both fell last week.


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.