Gold Tests $1,285 On Friday

November 17th, 2017 by

The precious metals looked to hold onto their gains from this week as all four metals moved higher in early trading on Friday. Spot gold was up 0.5% to $1,285/oz while spot silver added 3¢ to $17.08/oz. Platinum (+1.0%) and palladium (+0.2%) each traded higher, as well.

Safe-haven demand has picked up slightly over the course of the week, pushing the 10-year Treasury yield down to 2.35%. Wall St opened mixed but generally in the red on Friday after posting solid gains during Thursday’s session. In the foreign exchange markets, the dollar was down slightly to 93.8 on the DXY index. The yen gained ground to trade at ¥112.5 per dollar while the euro slipped just a notch below $1.18.

Government data released this morning showed that the outlook for the housing market brightened last month, as new home starts jumped 13.7% in October. This was the highest level in a year. Accordingly, homebuilder confidence is registering at an eight-month high in November. The report also indicated that permits for building new single-family homes hit its highest in over 10 years, since before the housing crash in 2008.

Other economic news this morning focused on the controversial Keystone pipeline in the northwestern U.S. and Canada. The pipeline sprung an oil leak that amounted to 5,000 barrels of oil lost, or the equivalent of 210,000 gallons of crude. The leak was discovered in South Dakota, and a portion of the pipeline system was subsequently shut down to deal with the leak. The incident impacted oil prices: WTI crude rose 1.4% to nearly $56/bbl this morning while Brent crude also gained about 1% to approach $62/bbl.

In Washington, the U.S. House of Representatives passed its version of the tax reform bill yesterday by a comfortable margin. Although there is still a long way to go for the measure to ultimately make it through the Senate, this was seen as an important first step.

Meanwhile, the Federal Communications Commission (FCC) voted in favor of loosening restrictions on consolidation of media ownership. This continues a process that began more than a decade ago to eliminate regulations barring television stations and radio stations from owning multiple newspapers and vice versa. The FCC cited the greatly fragmented media landscape as one of the reasons that the old rules are no longer useful.

 

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