Gold, Silver Up, USD Down, Safe-Haven the Focus

Gold, Silver Up, USD Down, Safe-Haven the Focus

$GLD, $SLV, $USD, $XAU, $XAG

Gold rose more than 1% Tuesday as fears of a possible recession gripped investors following disappointing US economic data, while silver marked $18 for the 1st time in nearly 2 years.

  • Spot gold was up 1% at $1,540.57 oz at 1:41p EDT (1741 GMT),
  • US gold futures for December settled up 1% at $1,551.80 oz,
  • Spot silver extended gains for a 3rd session running +3% to $18.15oz, The Devil’s metal earlier hit $18.20, its highest mark since September 2017.

US consumer confidence was down a bit in August and growth in home prices hit its slowest pace in nearly 7 years.

“A lot of people are worried about the one economy that is doing well now, the U.S. economy, and with these numbers for the consumer confidence, that puts it into question a little bit,” said the President of world markets at TIAA Bank.

“The inverted yield curve is certainly a recessionary signal. That adds flows into gold as a safe haven.

The Us yield curve went deeper into inversion midday Tuesday as Wall Street’s earlier gains faded on renewed concerns about a US recession and ongoing trade tensions.

Comments by President Trump that China had offered to resume trade talks assuaged some concerns in the wider financial markets.

The trade war between the world’s 2 largest economies has shaken markets since it began more than a year ago, triggering fears of a global economic slowdown. This helps gold, often considered a safer place to park assets during times of global uncertainty.

Meanwhile, markets priced in a 1/4th pt cut in interest rates by the Fed next month, and over 100 bpts of easing by the end of next year. Lower US interest rates put pressure on the Buck and bond yields, increasing the appeal of non-yielding gold.

Also helping the precious metals complex is a weaker USD.

Stay tuned…

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Paul Ebeling

Paul A. Ebeling, polymath, excels in diverse fields of knowledge. Pattern Recognition Analyst in Equities, Commodities and Foreign Exchange and author of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly regarded, weekly financial market letter, he is also a philosopher, issuing insights on a wide range of subjects to a following of over 250,000 cohorts. An international audience of opinion makers, business leaders, and global organizations recognizes Ebeling as an expert.

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