The precious metals—along with stocks, bonds, and basically every other sector—were fairly quiet early during Monday’s trading session, with modest downward movement seen across the markets. Spot gold traded slightly lower to $1,294/oz while silver prices lost about 10 cents to just below $16.90/oz. The spread between platinum and palladium has now narrowed to the point of being virtually negligible, with less than $20 per ounce separating the two metals.
Here are the precise numbers for the precious metals in early trading, as of 9:30 am ET:
Gold: $1,293.60/oz (-$3.50, 0.27%)
Silver: $16.88/oz (-10¢, -0.59%)
Platinum: $929/oz (-$2, -0.21%)
Palladium: $914/oz (unchanged)
Stock markets in the U.S., Asia, and across Europe were in slightly negative territory to begin the week. The euro lost ground to the USD, helping push the dollar about 0.4% higher on the DXY index to 92.5. Somewhat surprising election results in Germany (as far as which parties will form a coalition with Chancellor Angela Merkel’s government, which retained power) were part of the cause of the euro’s losses. This retreat for European markets is based on the expectation that the process of realigning the new German government will be messy for the next few weeks. Meanwhile, the 10-year Treasury yield in the U.S. held steady at 2.25% on Monday.
Some of the credit (or blame) for the declines on Wall St is being attributed to the latest news about the Trump administration’s plans for cutting taxes. Like most of the president’s policy proposals through nine months in office, the policy itself is seen by the markets as a win for Wall St. However, as with other key issues like healthcare and immigration, a failure to push the tax cuts through Congress would have the effect of dragging the stock market lower.
Elsewhere in the policy sphere, investors are still closely watching for signs from the Federal Reserve about whether or not the central bank will live up to its pledge to begin shedding some of its balance sheet and continue raising interest rates. New York Fed President Bill Dudley recently opined that stronger fundamentals for the U.S. economy and a gradual rise in inflation can be expected over the medium term, bolstering the case for raising rates in the coming months.
Interestingly, there will be quite a bit of turnover at the Fed over the course of the next year or so, meaning that a largely fresh crop of policymakers will be tasked with carrying out the plans that the current makeup of the Federal Reserve has laid out. It’s an open question whether or not the new incoming membership will simply change course in 2018 and beyond, or if the forecast for gradually rising rates and policy normalization will indeed hold true.
The opinions and forecasts herein are provided solely for informational purposes, and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.