Gold Price Rebounds From 6-Week Low

October 2nd, 2017 by

Gold prices were rebounding Monday morning, in part due to some temporary save-haven flight in the immediate aftermath of the horrific shooting in Las Vegas last night.

The shooting that occurred in Vegas is believed to be the single-worst mass shooting ever on American soil. At least 50 are reported dead with more than 400 people hospitalized due to the senseless act. A man in the 60s identified as Stephen Craig Paddock opened fire at an outdoor country music concert on Sunday night. Paddock was found dead in his hotel room, along with various firearms, after a confrontation with police. Witnesses on the Las Vegas Strip say the fire came from the nearby Mandalay Bay casino and hotel, where Paddock was staying on the 32nd floor. The attack is somewhat reminiscent of a bombing that took place at a concert in Manchester, U.K. earlier this year.

Spot gold was lower in early trading but recovered to $1,276/oz, down $3 per ounce. Spot silver was actually 2ยข in the green at $16.65/oz. Platinum and palladium each held near unchanged.

Wall St nonetheless opened modestly higher. The U.S. dollar was up again, trading at 93.5 on the DXY index. This knocked the euro down to $1.175 against the dollar, while the British pound sterling fell almost 0.9%. Stocks were mostly higher in Europe, while most Asian markets were closed for holiday but last ended higher. The 10-year U.S. Treasury yield held at 2.32%.

Aside from the stronger dollar, some of the downward pressure on the euro came from the unrest over the issue of the Spanish region of Catalonia breaking off as an independent republic. The semi-autonomous region is home to Barcelona, the country’s second-largest city (and the seventh-biggest in all of the EU), and has a long history of self-governance. It is located in the northeast corner of Spain and is bordered by France to the north.

However, even before a proposal for independence was voted on, the Spanish government declared such a referendum illegal. Catalonia went ahead with the referendum on Sunday anyway amid great unrest and intimidation. Spanish authorities attempted to block the vote from taking place, because the act is not technically permitted by the country’s constitution. Nonetheless, it’s being reported that more than 2 million Catalans voted in favor of independence. The leaders of the regional government seem to be prepared to unilaterally declare independence and press the matter in European courts, creating the potential for a constitutional quagmire if the separation is indeed successful.


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