Precious Metals Weekly Round-Up: Gold Dips Ahead of US Jobs Report

Gold dipped over 1 percent on Friday (July 5) as the US dollar strengthened ahead of the release of US jobs data.

The yellow metal is on the decline as investors await the data, which will be released later today, as it could offer guidance on the US Federal Reserve’s upcoming interest rate decisions.

“At the moment, we see the dollar a tad stronger and the euro weak, which usually holds gold back. The readiness to push prices higher by speculators is also pretty limited,” said Carsten Menke, analyst at Julius Baer.

“The gold market still has to adjust to the rapid rally we saw at the beginning of the week when prices shot back above US$1,400 per ounce, which in my view was driven by more positive sentiment in the gold market rather than any fundamental developments,” he added.

Despite the relatively small decline that the precious metal experienced on Friday, gold is still in the green for the week — up 0.2 percent — and headed for its seventh straight week of gains.

As of 8:47 a.m. EDT on Friday, gold was trading at US$1,399.30.

Silver is also down over 1 percent on Friday, but could make a rebound if today’s US Job Report acts as an indication that the Fed will cut interest rates later this month.

Many market watchers remain positive about the white metal, despite its current stagnant nature. In its latest report, FocusEconomics says that analysts it has polled are optimistic about future silver prices.

“Prices should continue to trend higher moving forward. Barring a significant global slowdown, demand for industrial fabrication is projected to rise this year, as should demand for jewelry and silverware fabrication,” the report reads.

The analysts forecast that the silver price will average US$16.20 per ounce in Q4 of this year before rising to an average of US$17 in the fourth quarter of 2020.

As of 8:54 a.m. EDT on Friday, silver was trading at US$15.12.

As for the other precious metals, platinum is down nearly 2 percent for the week. As of 8:56 a.m. EDT on Friday, the metal was changing hands at US$825 per ounce.

For palladium‘s part, it was the only precious metal to make gains early in the session on Friday, ticking up 0.06 percent. As of 9:00 a.m. EDT, the metal is headed for its fifth straight week of gains, trading at US$1,557 per ounce.

Precious metals top news stories

Our top precious metals stories this week include a list of the best gold and silver stocks of 2019 on the TSX and a report on Barrick Gold (TSX:ABX,NYSE:GOLD) and Newmont Goldcorp (TSX:NGT,NYSE:NEM) launching their joint venture (JV) project in Nevada.

1. Best Gold Stocks of 2019 on the TSX

The gold price was relatively flat during the second quarter, until it hit its highest level in over six years on June 25, when it traded just below US$1,440 per ounce.

Between price gains and mergers and acquisitions, some gold companies made progress and expanded the resource potential of their assets. Now that Q2 has come to a close, the Investing News Network (INN) has rounded up the top five gold stocks on the TSX that have seen the biggest share price gains year-to-date.

2. Best Silver Stocks of 2019 on the TSX

The silver price was relatively flat during the second quarter of the year, and, while it managed to hit a high of US$15.41 per ounce on June 24, it only managed to gain just under 1 percent overall in Q2.

Despite the white metal’s inability to make significant gains, some silver companies still managed to make progress and expand the resource potential of their assets. Now that Q2 has come to a close, INN has rounded up the best silver stocks on the TSX that have seen the biggest share price gains year-to-date.

3. Barrick and Newmont Launch World’s Largest Gold Producing Complex

Barrick Gold and Newmont Goldcorp announced that they have officially launched their JV project in Nevada, creating the world’s largest gold complex with the introduction of Nevada Gold Mines.

As per the joint statement released on Monday (July 1), Barrick holds a 61.5 percent stake in the new company and will also act as the operator. Newmont owns 38.5 percent of the Nevada-based company.

“(Nevada Gold Mines’) creation was driven by a compelling logic which had long been evident to all but had been elusive for two decades until we finally achieved a breakthrough this year,” said Barrick President and CEO Mark Bristow.

Also in the news

In other precious metals news this week, Acacia Mining (LSE:ACA) reported a 13 percent increase in gold reserves at its Gokona asset in North Mara, Tanzania. The miner noted that the uptick in reserves stems from additional drilling in the east and west extensions of Gokona underground.

This reveal adds further weight to Acacia’s belief that Barrick Gold (TSX:ABX,NYSE:GOLD) has deeply undervalued the company. Barrick began its endeavor to purchase the remaining shares of London-listed company back in May, but shareholders of Acacia stated that they strongly disagreed Barrick’s valuation of the company, claiming that the proposal undervalued its mine plans and ignored the value of its exploration and development assets.

Additionally, Equinox Gold (TSXV:EQX) announced that is has commenced commercial production at its Aurizona gold mine in Brazil.

Throughout June, the Aurizona processing plant achieved an average throughput of approximately 8,200 tonnes per day. The asset also exceeded 90 percent average recovery and produced more than 7,000 ounces of gold. Gold production is expected to continue to increase during the last two quarters of this year, with average life-of-mine production estimated to be around 136,000 ounces per year.

“Achieving commercial production at Aurizona is a significant milestone, making Equinox Gold a multi-mine producer and bringing us one step closer to our near-term target of having three mines in production in 2020. We are pleased that Aurizona is ramping up quickly and thank our team, contractors and stakeholders in Brazil for their hard work and support,” said Christian Milau, CEO.

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