Weekly Round-Up: Gold Price on Track for Biggest Weekly Gain Since May

The gold price rose on Friday as the US dollar fell against the euro.

gold price silver copper oil

The gold price jumped on Friday (July 21), and was on track for its biggest weekly gain in two months. The US dollar fell against the euro to its lowest level in more than a year, making gold cheaper for buyers using other currencies.  

“The dollar has been under serious assault, which has pushed the price of gold higher,” said Naeem Aslam, chief market analyst at ThinkMarkets UK. “As long as the dollar bleeds, we do think that the gold price would continue to move higher and could touch the level of $1,300.”

Another factor driving the gold price is uncertainty surrounding a third rate hike by the US Federal Reserve. Last month, the Fed increased interest rates for the second time in 2017, but recent economic data is raising doubts about what policymakers will decide when they meet again in September.

A gradual rate increase would be good news for gold, which tends to fare better when interest rates are low and often struggles when interest rates increase. That’s because higher rates curb the investment appeal of non-interest-bearing assets like gold.

Next week, the Fed will hold a two-day monetary policy meeting, and traders will be looking for clues as to what their next rate hike move might be.

Overall, “fundamentals have been constructive for gold — everything from the [U.S. Special Counsel Robert] Mueller news just now to deadlock in Washington, dismal economic growth and geopolitical fears,” Bill Baruch, chief market strategist at iiTRADER, told MarketWatch.

As of 1:00 p.m. EST on Friday, the gold price was at $1,253.89 per ounce. Click here to read about gold’s performance in Q2 and what’s ahead for the yellow metal.

Looking over to silver, the white metal climbed 0.9 percent on Friday, rising more than 3 percent for the week. As of 1:00 p.m. EST on Friday, the white metal was sitting at $16.48 per ounce. Click here to read about silver’s performance in Q2.

Palladium gained 0.7 percent on Friday, trading at $848.50 per ounce, while platinum rose 0.8 percent, to $933.74 per ounce.

On the base metals side, the copper price hit a four-and-a-half-month peak on Friday, fueled by strong growth in top copper consumer China, a weak dollar and worries about supply disruptions. Click here to learn about copper’s performance in Q2. 

Lastly, spot oil pulled back on Friday after climbing above $50 a barrel earlier in the week. Traders are awaiting data on US production and an upcoming OPEC meeting next week.

September West Texas Intermediate crude lost 78 cents, or 1.7 percent, to reach $46.14 a barrel on the New York Mercantile Exchange, while Brent crude for September delivery on London’s ICE Futures exchange fell 72 cents, or 1.5 percent, to $48.58 a barrel.

Don’t forget to follow @INN_Resource for real-time news updates! 

Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.


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Weekly Round-Up: Gold Price Climbs on Weak US Economic Data

By Priscila Barrera, July 14, 2017.

The gold price jumped on Friday (July 14), and was on track for its biggest weekly gain since mid-May. Flat US inflation data and weaker-than-expected retail sales eased worries about another interest rate increase later this year.

“The downside surprise in inflation and retail sales data was not good news for the dollar index and investors have pushed their bearish bets further,” said Think Markets analyst Naeem Aslam. “Gold is the net beneficiary of this data as investors factor in the impact of the rate hiking cycle.”

Last month, the US Federal Reserve increased interest rates for the second time in 2017. But the economic data released on Friday may be viewed as providing insufficient support for the Fed to hike rates when policymakers meet again in September.

On Wednesday, Fed Chair Janet Yellen said in congressional testimony that the Fed will need to keep gradually raising US interest rates in the coming years, but not to levels seen in previous cycles.

“The main takeaway for gold investors should be Yellen’s continuous focus on ‘gradual’ rate hikes and balance sheet reductions, and this could be interpreted as fewer rate hikes with more time in between hikes than originally expected,” Nico Pantelis, head of research at Secular Investor, told MarketWatch.

That could be good news for gold, which tends to fare better when interest rates are low and often struggles when interest rates increase. That’s because higher rates curb the investment appeal of non-interest-bearing assets like gold.

A weaker US dollar also supported gold, as a softer greenback makes commodities priced in dollars cheaper for buyers using weaker currencies. As of 1:00 p.m. EST on Friday, the gold price was changing hands at $1,228.46 per ounce. 

Click here to read more about gold’s price performance in Q2 and what’s ahead for the yellow metal.

Looking over to silver, the white metal was on track for a 2.5-percent gain on Friday, its biggest one-day rise since mid-March. As of 1:00 p.m. EST on Friday, the white metal was at $15.95 per ounce. Click here to read more about the silver price performance in Q2.

Palladium gained 1.2 percent on Friday, trading at $861.70 per ounce, while platinum rose 2.2 percent to $921.50 per ounce.

On the base metals side, copper prices were up 1 percent, at $5,880 a tonne, supported by positive economic reports from top consumer China.

Lastly, spot oil rose on Friday after reports pointed to higher demand and supply concerns in Nigeria. August West Texas Intermediate crude rose 24 cents, or 0.5 percent, to $46.32 a barrel on the New York Mercantile Exchange, while Brent crude for September delivery on London’s ICE Futures exchange climbed 26 cents, or 0.5 percent, to $48.68 a barrel.

Don’t forget to follow us @INN_Resource for real-time news updates!

Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.

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