Gold, silver, and base commodities are lower this morning, while global stock markets are mixed, due to the economic and political uncertainty emanating from Washington. Mixed messages from Federal Reserve board members, as well as budget and debt ceiling showdowns in Congress have traders with no real information on which to base trades. Precious metals were down moderately overnight, before being hit by news that U.S. home prices in July were up 1.8% over June, and up 12.4% year over year. Eager for anything on which to hang a trade, short-term traders jumped on the news. sending gold lower. The yellow metal began immediately recovering, however. Platinum had recovered into positive territory in Europe prior to the U.S. housing numbers, while palladium has been the least affected of the precious metals.
The dollar, which had been languishing near unchanged, received a minor boost from the news, while the euro dropped below 1.35 on remarks by ECB chairman Mario Draghi, who stated that the central bank was ready to inject more money into the Eurozone if needed to promote an economic recovery.
The head of China’s anti-trust agency, the National Development and Reform Commission, declared that “Only heavy punches will work” in combating the monopolistic practices of international corporations, warning that more companies were under investigation.
Asian markets were down slightly, while Euro markets were choppy on news German business confidence improved, but less than expected. Wall St. opened lower, Yields on the 10-year Treasury note was down to 2.68%, while German 10-year bunds were slightly lower as well.
Physical gold demand in Asia should pick back up, as the Chinese return after sitting out last week’s price spike, and import rules in India are clarified before the important fall wedding and festival season.