The precious metals are modestly higher to unchanged this morning after yesterday’s healthy gains. Key outside markets this morning include the US dollar, which overcame losses in Europe to regain yesterday’s closing price; and oil futures, which are seeing slight gains after plunging 4% on Monday.
Spot gold is trading $4 higher this morning, around $1,180 an ounce. Yesterday’s rally of $8.60 lifted prices back to the $1,180 mark. Spot silver is moderately higher at $16.65, while platinum is barely unchanged. Palladium is $3.00 higher in early trading, hitting the $760 mark.
In the futures market, February COMEX gold is unchanged since yesterday, when it ended near a 6-week high Monday marked the first back-to-back gains in gold futures since the November elections. March silver futures are marginally lower, down by 3 cents. The metal recorded gains of over 1% yesterday.
Stocks ended mixed Monday, with the Dow and S&P 500 ending lower, while the Nasdaq gained 0.2% to hit a new record-high.
Oil prices were hit hard on Monday, on views that Iraq was already cheating on the oil production agreement. The Baker Hughes rig count registered a gain of 4 rigs to bring the total of active US oil rigs to 529. This is the tenth week in a row that the number of onshore rig counts have risen.
Government bonds also increased Monday along with gold. The benchmark ten-year US Treasury note fell by 4 basis points to end at 2.377%, while the demand for 30-year bonds saw yields fall to 2.971%.
More speculators are pulling out of the overcrowded long trade in the dollar, which is showing up as recent weakness in the greenback. The dollar got some help Monday from the British pound, which fell to a 10-week low on Prime Minister Teresa May’s announcement that regaining control over immigration and getting out from under EU laws was more important than retaining access to the Common Market.
Rising Treasury prices, which mean lower yields, are also putting some headwinds against the dollar. The recent dollar rally has depended on rising yields for a substantial portion of its recent strength. Monday saw the dollar fail to brake the 103 mark against a basket of currencies, and is down under the 102 mark in morning trading.
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