Weekly Round-Up: Gold Price Falls on Yellen Comments

Silver and oil prices also fell overall this week, while the copper price remained fairly steady.

gold price silver copper oil

The gold price reached its highest point in three and a half months last week, but this week the yellow metal’s performance was more subdued.

Investor uncertainty ahead of US President Donald Trump’s first address to Congress on Tuesday (February 28) led to a shaky gold price early in the week, while later in the week comments from the US Federal Reserve Chair Janet Yellen further subdued the precious metal.

According to Reuters, Yellen said Friday (March 3) that the central bank will raise interest rates later this month as long as jobs and inflation data holds up.

“At our meeting later this month, the committee will evaluate whether employment and inflation are continuing to evolve in line with our expectations, in which case a further adjustment of the federal funds rate would likely be appropriate,” she said at a business luncheon in Chicago.

As of 1:00 p.m. EST on Friday, the gold price was sitting at $1,228.70 per ounce, well below last week’s high point of $1,251.41.

Silver had an even worse week than gold, taking a steep fall on Thursday morning. It dropped from $18.31 per ounce to $17.71 in the span of a few hours, pressured downward by the same factors facing gold.

On the base metals side, three-month copper on the LME slipped ahead of Trump’s address to Congress, coming in at $5,908.50 per tonne. By Friday, it was up slightly at $5,917. Reuters notes that copper has consolidated in the $5,800 to $6,200 range since reaching a 20-month high of $6,204 on February 13.

Finally, oil futures were on the rise on Friday, boosted in part by news of OPEC’s high compliance with output cuts. An evacuation at Libya’s largest oil port also helped bump up prices, says Marketwatch.

On Friday morning, April West Texas Intermediate crude was up 1.1 percent, at $53.18 per barrel, on the NYMEX, while May Brent crude was up 1 percent on the ICE Futures Exchange at $55.62. Despite those increases, both were set to record weekly losses.

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

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This article is updated each week. Please scroll to the top for the most recent information.

It was a week of highs for the gold price as the yellow metal reached its highest level in three months on Friday (February 24). 

Friday morning, the precious metal soared to $1,258.90 per ounce, catapulted by comments made by the Federal Reserve and political uncertainty in the US and overseas, the Wall Street Journal stated.

Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen, said in a note on Friday that gold price support has “come from the unwinding of the post-election Trump trade, which has seen bond yields and the US dollar both move lower.”

Similarly, Andy Schectman, president of Miles Franklin, told the Investing News Network (INN) that Trump may “get what he wants, which is a weaker dollar.”

“If so, that means gold should outperform all expectations,” he continued. “A weaker dollar and the fact that other currencies are crashing like the Euro, which this morning is within basis points of a fresh 14-year low, are making it that much more difficult to overcome surging demand for history’s most time-honored store of value, gold.”

As of 1:18 p.m. EST on Friday, the gold price was $1,256.60 per ounce.

Gold’s sister metal, silver, has also had a strong week.

The Economic Calendar wrote on Friday that the rising white metal is pushing into “positive territory” for the five-day period as the US dollar lowered for a third straight session. The publication further noted that the silver was on pace for a five-day gain of 1.5 percent.

As of 1:20 p.m. EST on Friday, the silver price $18.31 an ounce.

Looking over to the base metal side of things, the copper price was also on pace for a week of gains.

On Thursday, Market Realist stated that the red metal has risen 9.6 percent so far in 2017. That said, the publication further notes that supply issues could “push the copper markets into a supply deficit” in 2017.

Still–as of 1:30 p.m. EST on Friday, the red metal was $2.68 per pound, making that a 8.37 percent increase over the five-day period.

Lastly, spot oil prices had a bit of a rocky week, dropping over concerns on surging US output, Reuters reported on Friday.

The publication further stated that the price dropped even though OPEC vowed to increase compliance with output curbs.

“The oil market remains focused on the global rebalancing act, with attention centered on compliance and US production growth.” Michael Tran, director of energy strategy at RBC Capital Markets, told Reuters.

As of 2:00 p.m. EST on Friday, spot oil prices were $54.02 per barrel.

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

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