Precious metals are following gold sharply higher this morning, as growing unrest over President Trump’s declared Middle East immigration ban rattles investors.
Spot gold is more than $17 an ounce higher at $1,212.50 in early New York trading, with April COMEX futures close behind. Spot silver is up 2.2% to $17.45, with March silver futures also keeping pace. Spot platinum is up $7.00 at $994.00, while April platinum flat. Palladium, which has been the best performing precious metal in 2017 so far, is up nearly 2% this morning to $752.00. March palladium futures are also $14 higher.
The Shanghai Gold Exchange, Asia’s largest, was closed yesterday (and today) for the Chinese New Year, removing some demand from the market, but gold prices began climbing in Asia almost immediately after the open. Traders and investors are piling into safe haven plays, as global protests continue over the sudden US travel ban on residents of seven unstable countries in Central Asia where there is known Islamic terrorist activity. Trump also made waves by dismissing the country’s acting attorney general. Tuesday marks the third consecutive day of gains for gold. January is rounding out as the best month for the yellow metal since June.
Aside from markets reacting to news out of the White House, there was a lot of focus on economic data out of Europe today. The annual inflation rate in the eurozone was most recently clocked at 1.8%, the fastest acceleration of consumer prices since 2013. Unemployment in the region has hit its lowest since 2009, while the modest 0.5% rate of GDP growth in the EU during the fourth quarter was generally taken as a surprise to the upside. This helped the euro recover from an 11-day low to trade at about $1.08.
Elsewhere in Europe, Germany’s Deutsche Bank (DB) is again adding to its ledger of fines and out-of-court settlements. After regulators heaped another fine on the megabank for allegedly providing assistance to Russian money launderers, the firm’s fines have now piled up to $629 million. Of course, this still pales in comparison to the $10 billion the bank is accused of helping change hands in the scheme.
Meanwhile, the Bank of Japan (BOJ) stood pat at its most recent meeting. The central bank’s inflation outlook is mostly unchanged, meaning that stimulus measures are expected to remain in place. Yet, the more encouraging data from Europe is raising questions about whether or not the European Central Bank (ECB) will continue its own stimulus program or scale back its efforts.
Looking ahead, tomorrow the Federal Reserve Open Market Committee (FOMC) will conclude its two-day meeting with an announcement to the press. Investors will also be closely watching quarterly earnings data from Apple Inc. (AAPL) this afternoon.
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