Thursday saw some choppy action for the gold market after the precious metals were again trending higher following last session’s gains. After undulating in early morning trading, spot gold is back 0.5% above unchanged around $1,253 per ounce. Spot silver was also higher, adding to 0.85% to approach $16.60/oz.
Platinum prices also gained 0.5% on Thursday to move back above $930/oz, while palladium was flat at $880/oz. The spread between the two metals remains remarkably low by historical standards. This is largely owed to the fact that as the other three precious metals have lost ground after the June rate hike by the Fed, palladium kept defying expectations by moving sharply in the opposite direction. This may be due to a confluence of strong automobile demand and tighter global supply of the Platinum Group Metals due to persistent labor unrest at South Africa’s major mines. (South Africa accounts for 70% of the world’s platinum production each year, while much of the rest of the world’s platinum and palladium come from Russia.)
Here are yesterday’s closing numbers (June 21st) for the precious metals for reference:
Gold: $1,246.30/oz (+$3.70, +0.3%)
Silver: $16.42/oz (-1¢, -0.1%)
Platinum: $927/oz (+$7, +0.76%)
Palladium: $883/oz (+$11, +1.26%)
Weekly jobless claims rose slightly to 241,000 new claims, which is still viewed as a healthy number for the employment outlook. Equities were generally down, however, in trading across the Atlantic while the S&P 500 also opened a tick lower. Overnight, the major Asian markets were each down modestly. Despite rising interest rates in the U.S., the 10-year Treasury yield remains parked at just 2.14%. Crude oil prices bounced from near their recent one-year lows, though this surprisingly didn’t translate into gains for the dollar. Although it would have seemed absurd to say only three years ago, or even a year ago, it seems that chronically low prices have dampened the disproportionate sway that oil prices once held over the larger complex of global trade.
Some of the big news in the U.S. centered on the successful apprehension of a jihadist who attacked law enforcement at the Bishop Airport in Flint, Michigan yesterday. The man managed to stab a police officer, whose injuries have since been upgraded from critical condition. Though he is believed to have been a “lone wolf” actor who was simply inspired by extremism (rather than directed by any arm of the so-called Islamic State), the assault has officially been classified as an act of terrorism.
One political story that could have major economic implications is today’s unveiling of the latest healthcare replacement plan by GOP leadership in the U.S. Senate. While Senate Republicans have a slim majority that could allow them to pass what has long been promised as an Obamacare “repeal-and-replacement” bill without any need for Democratic support, the reaction to the Senate proposals remains in question. It’s telling that the bill was crafted almost entirely in secret, as senators will gauge the public reaction before voting. A similar measure required an active push from President Trump to make its way through the GOP-controlled House of Representatives just weeks ago.
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