Gold slumps on strong Treasury yields and positive economic news, however the platinum group metals look to have their best month since November.
Benchmark Treasury yields spiked to a one-year high and the dollar advanced, taking a bit of the shine off of gold. All three assets are traditional hedges against inflation, however, which kept a floor under gold prices.
Meanwhile, this morning’s U.S. economic data shows that while personal income for January leapt up 10%, higher than the Dow’s 9.5% forecast, inflation remains low. The Core PCE inflation is up 1.5% year over year, below the Fed’s 2% target. The rise in personal income is largely due to government stimulus checks and bolstered unemployment benefits.
April gold futures slipped 1.3% Thursday to settle at $1,775.40 an ounce on Comex. Prices are down 0.1% so far this week after dropping 2.5% last week. Bullion has retreated 4.1% so far in February after declining 2.4% in January. Gold climbed $372 — or 24% — in 2020 because of uncertainty about the economy and the pandemic. Currently, the April contract is down $14 an ounce to $1,760.80 and the DG spot price is $1,760.50.
Holdings in SPDR Gold Trust, the world’s largest gold-backed exchange-traded fund, fell 0.6% Thursday to its lowest level since May 2020, Reuters reported.
Gold is also getting support from efforts to pass President Joe Biden’s $1.9 trillion economic stimulus measure, which may face a vote in the House of Representatives as early as Friday. The measure is designed as a shot in the arm to an economy still reeling from the pandemic, though weekly U.S. initial jobless claims
The COVID-19 virus has killed almost 2.51 million people worldwide and sickened almost 113 million. About 25% of the cases — and 20% of the deaths — are in the U.S. The country has about 28.4 million cases, more than any other nation.
May silver futures declined 0.9% Thursday to settle at $27.69 an ounce on Comex. They are up 1.4% so far this week. The metal is up 2.9% so far this month after gaining 1.9% in January and 47% in 2020. The front-month contract rallied 16% between Jan. 28 and Feb. 1. The May contract is currently down $0.70 an ounce to $26.985 and the DG spot price is $26.85.
Spot platinum slipped 1.9% Thursday to $1,238.80 an ounce and is down 3.2% this week. It has gained about 15% so far this month amid forecasts for higher demand and tighter supplies and reached six-year highs last week. The autocatalyst metal advanced 0.5% in January and 11% in 2020. Currently the DG spot price is down by over $25 an ounce to $1,206.20.
Spot palladium decreased 0.9% Thursday to $2,434.50 an ounce and is up 2% so far this week. It’s up 9.2% in February after plummeting 9% in January and rallying 26% in 2020. The DG spot price is currently off by over $60 an ounce to $2,375.50.
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