Gold Steady Ahead of Trade Talks October 7, 2019 Gold steady ahead of trade talks, remaining little changed early Monday as investors looked for signs about the direction of the negotiations between the U.S. and China, which are scheduled to resume this week in Washington. Investors have turned to bullion as a hedge against uncertainty when the talks appear to be stalling. The next round of discussions is scheduled for Oct. 10 and Oct. 11. The yellow metal traded back above the key $1,500-an-ounce threshold on Comex for a fourth consecutive day Monday. The December gold contract rose 0.4% last week to settle Friday at $1,512.90 an ounce. Currently, the December contract is at $1,504.70. China is “increasingly reluctant” to sign the broad trade agreement being pursued by U.S. President Donald Trump, Bloomberg reported Monday, citing unidentified people familiar with the discussions. Senior Chinese officials have indicated that the topics they are willing to consider has narrowed. China has increased its gold reserves by more than 100 tons since it resumed buying in December, Bloomberg reported, citing data from the People’s Bank of China. The central bank boosted its holdings to 62.64 million ounces in September from 62.45 million in August, marking its 10th straight month of buying. Last week, the September U.S. jobs report showed that the unemployment rate hit a 50-year low, but hiring in the manufacturing sector slowed. The Labor Department data was seen as an indicator of the toll the standoff in China is having on the economy. It came on the heels of the monthly manufacturing report, which showed the lowest reading in more than 10 years for September. Speculation has grown that the U.S. Federal Reserve will cut interest rates for a third consecutive time when policy makers meet at the end of this month. The morning, the CME FedWatch Tool shows that 78.6% of investors think the Fed will cut interest rates by 25 basis points for a third consecutive time on Oct. 30, compared with 39.6% a week earlier. The probability of no change is 21.4%, compared with 22% the last week. In other economic news this week, the U.S. producer price index comes out Tuesday, and Fed Chairman Jerome Powell is scheduled to speak. The minutes of the last Federal Open Market Committee meeting will be released Wednesday, and investors are expected to scour it for clues on future direction. The U.S. weekly jobs report and U.K. monthly GDP numbers come out Thursday. And French President Emmanuel Macron has given British Prime Minister Boris Johnson until the end of the week to revise his Brexit plan enough to make it palatable to the European Union. Silver slipped 0.2% last week, with the December contract settling at $17.63 an ounce Friday on Comex. Both spot palladium and spot platinum also 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.