Good morning. The precious metals are lower in early U.S. trading.
U.S. calendar features Personal Income, PCE, Initial Jobless Claims, Chicago PMI, Pending Home Sales Index, Ag Prices.
FedSpeak dues from Bostic, Goolsbee, Mester & Williams.
With an upside breakout in the US dollar overnight surprisingly forged in the wake of a series of soft US data points over the last 5 sessions, the markets are expecting today's US GDP report to partially right the ship of the US economy.
However, it is also possible the dollar is feeding higher off persistent hawkish views from Federal Reserve members which could be expected to reach a fever pitch just before midsession today with the Fed's Bostic, Collins, and Williams speaking just ahead of midsession.
Expectations for US GDP call for no revision in a previous growth rate of 3.3%. While not a definitive bullish impact, a Russian gold mining group indicated last year's gold production declined by 6.8% on a base output of 412,500 Troy ounces...[MORE]
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With a three-day low in the dollar extending a lower high and lower low pattern and US treasuries posting early gains, gold and silver bulls have an edge from outside market action.
The dollar was clearly undermined by disappointing US new home sales readings for January yesterday, and we suspect the trade saw some anticipatory selling ahead of what is expected to be a very soft US durable goods report today (expectations -4.5%).
While we think softer economic activity will undermine gold and silver prices because of the recent focus on the potential for improved physical demand, it is possible a very disappointing US durable goods report will knock the dollar sharply lower and in turn help gold and silver find firm support...[MORE]
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The action in gold this morning should be concerning to the bull camp as the dollar remains vulnerable on its charts with five straight days of lower highs.
While not a major supportive development, treasury prices have added to last week's late rebound early today.
With a lack of global economic data overnight, generally lower equities, and a veritable avalanche of US scheduled data ahead this week some gold longs might be taking profits and moving to the sidelines temporarily...[MORE]
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Gold slipped on Monday as markets pared back expectations of the Federal Reserve’s easing cycle and cautiously awaited a key inflation reading this week, which is likely to provide an updated view on the timing of interest rate cuts.
Spot gold edged down 0.1% to $2,033.89 per ounce as of 1005 GMT, after rising to its highest since Feb. 7 on Friday. U.S. gold futures dropped 0.3% to $2,043.30 per ounce...[LINK]
Fortunately for the bull camp in gold, today's US economic reports slate is empty which could tamp down revived interest in the dollar following yesterday's flow of very favorable US housing and jobs data.
In retrospect, the higher high in April gold early Thursday was heavily dependent on the sharp washout in the dollar.
Unfortunately for the bull camp, the dollar staged a significant recovery and US treasury yields reached higher highs off further erosion of hope for a US rate cut...[MORE]
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