Weekly Round-Up: Gold Price Hits One-week Low on US Data

The gold price fell to a one-week low on Friday (November 3) after a positive US economic data reading pushed the dollar higher.
“The data was in a conflicting sequence but it is overall making the case for not just one further rate hike by the Fed in December but also for further, gradual increasing of rates in 2018,” said Quantitative Commodity Research consultant Peter Fertig.
On Thursday (November 2), US President Donald Trump nominated Jerome Powell to lead the Federal Reserve, a decision investors had widely expected. According to analysts, he is likely to continue with a gradual approach to normalizing policy, as he has backed Janet Yellen’s overall direction on monetary policy.

Investors have already priced in continuity in  Fed policy, and most are expecting one more rate hike before the year ends. The bank has increased interest rates twice this year and has signaled at least three more increases in 2018.
Another rate hike could be bad 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.
As of 1:00 p.m. EST on Friday, the gold price was $1,268.55 per ounce. “The general trend for gold over the last week has been positive, but the market will need to find a catalyst within the host of data released tonight to push through the strong resistance at $1,280,” analyst Tim Brown wrote in a note.
Looking over to silver, the white metal was on track for a weekly decline, trading lower on Friday due to the stronger dollar. As of 1:00 p.m. EST that day, the precious metal was $16.83 per ounce.
On Friday, palladium was down 0.6 percent, trading at $992.50 per ounce, while platinum declined 0.7 percent to change hands at at $918.30 per ounce.
On the base metals side, LME copper was trading up 0.1 percent, at $6,933 a tonne. Meanwhile, nickel was on track to gain nearly 10 percent this week — it was up over $1,100 since Monday (October 30) and was trading at $12,685 a tonne on Friday.
Lastly, spot oil rallied on Friday, as traders are optimistic about OPEC’s ability to balance the market and extend its current supply cut deal through to the end of 2018.
December West Texas Intermediate crude rose 0.2 percent, to $54.63 a barrel on the New York Mercantile Exchange, while Brent crude for January on London’s ICE Futures Exchange was up 0.3 percent, at $60.81 a barrel.
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Securities Disclosure: I, Priscila Barrera, hold no direct investment interest in any company mentioned in this article.