Gold Price Firm, “A Number of Positive Macro Catalysts Still Exist”



GOLD PRICE NEWS – The gold price inched higher on Monday amid a relatively quiet start to the week for financial markets.  The spot price of gold rose by as much as $11.71, or 0.7%, to $1,674.93 per ounce in overnight trading, but pared its gains as the U.S. dollar rebounded from its intra-day low against a composite of foreign currencies.  The SPDR Gold Trust (GLD), the world’s large gold price proxy and gold ETF, advanced by $0.40, or 0.3%, to $161.46 per share.

Silver outperformed the price of gold this morning, as it climbed $0.35, or 1.2%, to $30.85 per ounce.  With today’s strength in precious metals, the price of silver extended its year-to-date gain to 1.6%, while the yellow metal moved into positive territory by 0.1%.

Gold stocks also fared a bit better than the gold price on Monday, as the Market Vectors Gold Miners ETF (GDX) tacked on $0.35, or 0.8%, to $45.75 per share.  Notable gold stocks in the black included GDX components Goldcorp (GG), IAMGOLD (IAG), and Kinross Gold (KGC).  Shares of GG advanced by 0.5% to $37.07, IAG by 0.4% to $11.09, and KGC by 0.4% to $9.48.

Last week, the gold price rose by just 0.3%, but in doing so snapped a six-week losing streak – its longest since April-May of 2004.  However, the price of gold remains near the low-end of the range it has occupied since August of 2012.  Commenting on the recent weakness in gold prices, commodity strategists at Barclays Capital wrote in a note to clients that “Lack of conviction has tainted gold price action, and gold has struggled to establish its identity as a safe-haven asset.”

Barclays went on to say that “The hurdles for gold are mounting, from dollar strength to a softer physical market.”  However, the firm added that “In our view, a number of positive macro catalysts still exist that could push prices significantly higher.”

Looking ahead to this week, the U.S. economic calendar contains several reports that are likely to impact the price of gold and the broader financial markets.  On Tuesday morning, Retail Sales and Empire Manufacturing data will be announced, along with the Producer Price Index (PPI).  The Consumer Price Index (CPI), another key inflation measure, will be released on Wednesday morning, followed by the Fed’s Beige Book in the afternoon.  Thursday’s schedule includes Weekly Jobless Claims and the Philadelphia Fed Index, and the week then concludes on Friday with the University of Michigan Consumer Sentiment Index. 


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