The U.S. dollar regained its oomph over the weekend, after losing a bit of steam on Friday. In turn, the selling pressure on gold and silver is on the rise. In fact, gold is trading close to last week’s 12-month low, while the dollar index is very close to the 12-month high it hit a few weeks ago. In short, the dollar’s back up – gold soft.
At the time of this post, December Comex gold futures were down $6.20 an ounce at $1217.00 and December Comex silver was up $0.127 at $15.43 an ounce.
It’s likely gold will settle into summer doldrums until the next Fed meeting in September, unless geopolitical issues take off. And there certainly is the potential for that.
Asian markets led the way lower for global stock markets overnight. Trade war fears of a between the U.S. and China continue. China released an additional list of retaliatory tariffs late Friday. That was followed by President Trump claiming that America has the upper hand in a rally on Saturday night. China’s state media responded Sunday stating that the country is prepared for a “protracted war” and doesn’t fear sacrificing short-term economic interests.
Also, it would be good to keep an eye on the oil market as the U.S. is set to bring back economic sanctions on Iran tomorrow. The Obama administration had lifted the snactions as part of the Iran non-nuclear deal that has since been nixed by President Trump. This could be the next geopolitical flashpoint, which has potential for pumping up safe-haven gold and silver prices.
Have a wonderful Monday.
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