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Gold Prices Jump to $1240, Palladium Near Parity as 'Risk Rally' Fades Amid Brexit Legal Rows, 'Yellow Vest' Victory

December 5, 2018
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GOLD PRICES rose to $1240 per ounce in London trade Tuesday, challenging 4-month highs even as the US Dollar rose amid a retreat in ‘risk’ assets led by equities.
 
Silver rose to 4-week highs above $14.60 and palladium jumped to $1232 per ounce – a new record high in Dollar terms and nearing parity with gold for the first time since 2002.
 
Platinum prices failed to join the precious metals surge however, holding at $804 per ounce – a 10-year low when reached this July.
 
Gold priced in the Euro traded near 6-week highs as political tensions held firm in France and Spain, and UK gold prices meantime jumped to £973 – up 1.7% for this week so far – as Prime Minister Theresa May continued defending her proposed Brexit deal with the European Union amid a Parliamentary row over the legal advice given to her Government.
 
Gold priced in Sterling had earlier eased back as the Pound rallied on the FX market after the European Court of Justice’s most senior lawyer said the UK could, if it wished, revoke Article 50 before next March’s Brexit deadline and remain within the European Union on Britain’s current terms without needing approval from the other 27 member states.
 
Dropping again on Tuesday, London’s UK-focused FTSE250 stock index has now lost 11% in Sterling terms so far in 2018.
 
The more international FTSE100 index has dropped 8%.
 
UK gold price in Pounds per ounce. Source: BullionVault
 
Alongside platinum, yesterday’s rally in equity prices also failed to support so-called “crypto-currency” Bitcoin, which lost over 6% versus the Dollar only to regain that much early Tuesday.
 
“The risk-on vibe [has] inspired palladium bulls to continue to push the metal through $1200,” notes Swiss refining and finance group MKS Pamp.                       
 
“Tightness in this market continues to play a factor,” MKS goes on, pointing to wide trading spreads in palladium – which finds nearly 80% of its end-use in autocatalysts to reduce emissions from gasoline engines – plus high costs for booking physical delivery in early 2019.
 
As for gold prices, the metal “eased back slightly into [Monday’s] close…[but] managed to hold onto the [$1230] handle at the closing bell,” MKS’s trading team says – “a feat that hasn’t been achieved since late October and has proved a big hurdle over the past month.”
 
Euro gold prices today held near €1088 per ounce – the highest since late-October’s spike – as France’s prime minister Edouard Philippe today gave into demands from the so-called ‘galets jaunes’ protests which have now seen one person killed and hundreds injured in clashes with police.
 
After 2 weeks of marches, vandalism and violence from protesters wearing hi-vis yellow vests over the government’s new green tax-hike on fossil fuels, Philippe said the tax rise will be suspended from 6 months.
 
“We needed strong and visible measures. This is just a delay,” said one ‘gilets jaunes’ protestor.
 
“I doubt that the movement ends here.”
 
Meantime in Andalusia, and after conservative anti-immigration party Vox won 11% of the vote in last weekend’s local elections – claiming the first “far right” seats since the fascist Franco era – anti-Vox marches across the southern region last night saw protesters in Granada, Málaga and Seville declare “We are not afraid.”
 
Italy’s bond spread over comparable German yields retreated however, dropping near end-September levels at 280 basis points, as the left-right coalition of M5s and Lega politicians made further concessions to Brussels over its 2019 spending deficit plans.
 
Global stock markets reversed half of Monday’s rise, pulling the EuroStoxx 600 index over 7% lower from this time last year and putting China’s CSI300 more than 18% lower.

Silver Doubles Gold Price Jump After US-China Agree 90-Day Trade-War 'Ceasefire' at G20

December 4, 2018
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GOLD PRICES jumped on Monday as the US Dollar retreated on news of a “ceasefire” in the US-China trade war, agreed at this weekend’s G20 summit of world leaders in Argentina, writes Atsuko Whitehouse at BullionVault.
 
World stock markets also jumped, as did commodities, with crude oil adding over 5%.
 
After last month’s historic slump in oil prices, Saudi Arabia and Russia this weekend extended their pact to manage supplies between them, and Canada’s largest producing province ordered unprecedented supply cuts.
 
Opec-member state Qatar said Monday it is leaving the cartel, now due to meet in Vienna in Friday to agree 2019 quotas.
 
Silver prices outpaced gold this morning to trade 2.2% higher at $14.50 per ounce.
 
Spot gold climbed almost 1% to $1232 per ounce, more than three-week high, while the US Dollar Index – a gauge of its value versus six major currencies – traded down 0.5%.
 
While the US currency is heading for its 5th annual gain of the last six years, gold priced in Dollars held a 5% loss for 2018-to-date on Monday morning.
 
Chart of US Dollar index vs. gold priced in USD, year-end. Source: St.Louis Fed
 
Meeting in Buenos Aires on Saturday, US President Donald Trump and China’s President Xi Jinping agreed to a 90-day delay in applying the latest rounds of their import tariffs on goods from each other’s countries.
 
“Even though it’s [just] a 90-day truce and both US and China still need to sort out multiple issues in this period,” says Mayank Mishra, global macro strategist at Standard Chartered, “from the markets’ perspective getting [this] outcome and de-escalation of tensions is clearly positive for risk sentiment.”
 
At the summit in Argentina’s capital, the G20 leaders also managed to agree a joint declaration that noted divisions over trade but for the first time did not criticise “protectionism”.
 
“The over pessimism in bullion space on account of interest rate moving up is overdone and this is the right time to accumulate gold,” said Kunal Shah, head of research at Nirmal Bang Commodities in Mumbai, India, adding, “by December 31 we can see Comex gold [futures contracts] at $1250.”
 
Hedge funds and other money managers last week increased their bearish position in Comex gold futures and options by 19%, raising it to the notional equivalent of 161 tonnes in the week to Nov. 27, according to US regulator the CFTC.
 
The ‘Managed Money’ has now been net bearish for 20 weeks, by far the longest period since the CFTC started reporting in this format in June 2006.
 
Back from the G20 meeting, French President Emmanuel Macron has held an urgent security meeting following a day of riots by thousands of anti-government protesters.
 
Three people have been killed, more than 100 people were injured in the city, including 23 members of the security forces, and nearly 400 people were arrested, in the protests since demonstrations started more than two weeks ago, police said.
 
Gold prices for European investors rose to €1085 per ounce while Italian Prime Minister Giuseppe Conte signalled optimism that his government can reach an agreement with the European Commission over its 2019 budget deficit.
 
Also back from the G20 talks, Prime Minister Theresa May has just one week to convince dissenting members of Parliament to pass her ‘Brexit deal’ bill.
 
On Monday, the opposition Labour Party warned the UK faces a ‘constitutional crisis’ if May does not publish the full legal advice it has received on her Brexit deal.
 
Gold prices for UK investors climbed to £968 per ounce, the highest more than five weeks, as the British pound dipped 0.1%.

Gold Prices Slip as US-China and Trump-Russia Dominate G20, UK Lawmakers 'May Get' 2nd Brexit Deal Vote

December 1, 2018
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GOLD PRICES slipped on Friday in London, heading for a small weekly loss against the US Dollar and the Euro as world stock markets trimmed their earlier 2.8% rally from last weekend.
 
Geopolitical headlines meantime focused on the G20 meeting of major-economy political leaders in Buenos Aires, where US President Donald Trump is scheduled to discuss the worsening trade war with his Chinese counterpart Xi Jinping, but won’t now meet with Russia’s President Putin, blaming Moscow’s seizure of three Ukrainian naval ships.
 
Trump’s move was linked by some commentators with Thursday’s news that the US President’s former attorney Michael Cohen now says he lied about the celebrity real-estate magnate’s Russian connections.
 
After Ukraine’s President Poroshenko asked Nato to send ships this week, he has now blocked all Russian men aged 16-64 from entering his country.
 
Dropping through $1220 per ounce for US investors, gold prices held firmer for UK investors as the Pound fell amid fresh Brexit deal wrangling.
 
UK Prime Minister Theresa May today suggested in an interview from the G20 summit that she may ask Parliament to vote a second time if lawmakers reject the deal she’s agreed with the European Union.
 
“Only the ‘ultras’ have kept in place their ideologically-driven view that ‘no deal’ is a pain-free option,” says one long-time pro-Brexit blogger.
 
Looking at this week’s government and central-bank warning that ‘no deal’ could shrink UK GDP by 8%, knock one-third off house prices and push the Pound down by 25%, “If the UK gets caught in a spiral of negative feedback,” Richard North goes on, “the damage could be far worse than the Bank of England is suggesting.”
 
UK gold prices in Pounds per ounce held above £953 on Friday, little changed from this time last week.
 
Chart of UK gold price in Pounds per ounce. Source: BullionVault
 
Holding a small gain for the week meantime, European stock markets were capped by financial shares as German giant Deutsche Bank (ETR: DBK) slide over 2% after government investigators raided its offices again, seeking evidence of potential money laundering.
 
Deutsche’s stock has now almost halved in 2018 so far.
 
Peaking above $1228 per ounce on Thursday, gold prices yesterday recovered this week’s earlier 1% drop versus the Dollar after Federal Reserve chief Jerome Powell hinted that the US central bank is nearing the end of its interest-rate hiking cycle, starting at end-2015.
 
Like gold, the single Euro currency on Friday also gave back some of its post-Powell gains versus the Dollar after new data from the world’s second largest economic bloc pointed to a slowdown.
 
Italy showed a drop in GDP for the July-September period from the second quarter, and Eurozone unemployment then held at 8.1% in October instead of ticking lower as analysts forecast.
 
‘Core’ inflation meantime slowed last month to 1.0% per year across the 19-nation single currency union, while the headline rate slowed to 2.0% on the drop in fuel prices.
 
“The yellow metal made a slow grind higher through Asian hours,” says one trading desk, noting that the Shanghai premium – a measure of prices versus London quotes, and so a guide to demand and supply inside China, the metal’s No.1 consumer nation – held at $6 per ounce, only two-thirds of typical levels.
 
Over in No.2 consumer India, “the appreciating Rupee as well as weak demand [has] led to a slide in gold prices” down to 3-month lows say local reports.
 
“A fall in demand from jewellers as well as retailers has kept pressure on the prices.”
 
But “after decent sales during the Diwali festival,” counters Reuters, “jewellers have been replenishing inventories for the wedding season” according to one Mumbai-based private bank dealer.

Gold Prices Hold Powell's 'Just Below Neutral' Jump as US Data Point Down

November 30, 2018
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GOLD PRICES held onto last night’s $15 jump Thursday afternoon in London, more than erasing this week’s prior 1.0% loss after Federal Reserve chairman Jerome Powell hinted that the US central bank may be about to finish its interest-rate rises. 
 
Trading at $1228 per ounce, gold was outpaced by silver – up 0.6% for the week so far at $14.36 – and also by palladium, now setting fresh record highs above $1180.
 
Platinum prices also rallied Thursday, but held $20 below last Friday’s finish to trade at $823 after data from the miner-backed World Platinum Investment Council said the metal faces a half-million-ounce surplus of supply over demand in both 2018 and 2019.
 
Speaking to the Economic Club of New York on Wednesday, and forecasting “continued solid growth, low unemployment, and inflation near [the target pace of] 2%,” Powell said interest rates are now “just below…neutral…neither speeding up nor slowing down growth.”
 
While that exact phrase was used a day earlier by Fed vice-chair Clarida, the Dollar and gold’s price reaction was precisely opposite.
 
Wall Street today failed to extend Wednesday’s surge, the strongest 1-day gain in 8 months for the Dow stock index, edging back 0.3% in early trade.
 
Chart of US Dollar gold price, last week. Source: BullionVault
 
“[Powell’s] dovish remarks are in contrast to his October comment that the Fed was ‘a long way’ from neutral,” says a trading note from Swiss refiners and finance group MKS Pamp.
 
“The hint from the Fed that they are closer to ending the current rate hike cycle caught the markets somewhat by surprise,” agrees strategist Jonathan Butler at Japanese conglomerate Mitsubishi.
 
“Treasury yields and dollar dropped back, and that was quite supportive of gold…close to the highs we’ve seen over the past few weeks.”
 
New data yesterday said the US economy grew 3.5% annualized between July and September, in line with analyst forecasts.
 
But sales of new homes then cratered in October, plunging 8.9% month-on-month against Wall Street expectations for a 3.7%  rise.
 
While personal incomes and spending rose last month, new figures showed today, the Fed’s preferred inflation measure slipped back, missing analyst forecasts.
 
Last week’s US jobless benefit claims were also worse than forecast.
 
Crude oil meantime rallied Thursday after US contracts fell near $50 per barrel for the first time in 2018 on new data showing US stockpiles growing for the 10th consecutive week, suggesting a slowdown in demand.
 
Broader commodity markets struggled as copper slipped 0.5% to trade unchanged from 3 months ago and nearly one-fifth lower from the start of this year.
 
“It is unlikely that the yellow metal will break out above the upper bound of its recent trading range just yet,” says Canadian brokerage TD Securities’ Bart Melek, pointing to $1180-$1245.
 
The winning forecaster in 2017’s gold price competition from the London Bullion Market Association, “The market will need to see actual economic data disappointments and a structural move lower in the greenback,” says Melek, “before gold is to reach our projected $1300+ levels.”
 
Priced in the Euro, gold today held unchanged for the week at €1078 per ounce as the single currency rose against the Dollar on the FX market.
 
UK gold prices in Pounds per ounce meantime reached the top of this month’s trading range at £960 after Prime Minister Theresa May said she will activate “no deal” crisis planning if lawmakers vote against her proposed Brexit deal for next March’s exit from the European Union.
 
TV channels the BBC and ITV meantime argued about who should broadcast the ‘Brexit deal’ debate between May and opposition Labour Party leader Jeremy Corbyn, as it is scheduled to clash with some of their most popular shows.

Gold Prices Hold $10 Drop vs Dollar as What the Fed 'Omits' Spooks Traders

November 29, 2018
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GOLD PRICES held yesterday’s $10 drop on Wednesday, trading at $1214 per ounce against a strong US Dollar after Federal Reserve vice-chair Richard Clarida said his “base case” for 2019 sees a strong economy with a “robust” jobs market.
 
Also seeing inflation around 2%, Clarida’s outlook would meet the Fed’s dual mandate for growth and price-stability.
 
Betting on a December and then January interest-rate hike firmed in the futures market and the Dollar rose back near November’s 18-month high against other currencies.
 
That helped curb the drop in gold prices to 0.6% for UK investors at £948 with no change for Euro investors at €1076 per ounce.
 
“This will become the longest US expansion in recorded history if, as I expect, [it] continues in 2019,” Clarida said in New York on Tuesday.
 
In contrast to short-term rates, longer-term US bond yields were unchanged after his comments, leaving 10-year Treasury rates at 3.06% – some 18 basis points below this month’s rise to the highest cost of borrowing since mid-2011.
 
Gold prices have in 2018 broken what had become a strong inverse relationship with 10-year yields adjusted for 10-year inflation expectations.
 
https://www.bullionvault.com/gold-news/sites/default/files/real-10-10-gold-28-nov-18.png Chart of 10-over-10 US bond yields vs. gold prices. Source: St.Louis Fed
 
Compared to his last speech, Clarida this time “omitted” the word ‘some’ when saying again that “gradual policy normalization” is needed, says Bloomberg, spurring uncertainty for economists over whether the Fed is looking to pause or not after December’s rise.
 
“[Clarida also] omitted saying further rate hikes are likely appropriate,” notes CNBC anchor Steve Liesman, as well as omitting to say “Policy is still accommodative” and adding the word “just” to describing how the real inflation-adjusted policy rate remains “below neutral”.
 
Gold market traders have now “priced in” 10 of the 12 Fed interest rate hikes which Goldman Sachs expects will mark the end of the cycle starting end-2015, the investment bank said earlier this week.
 
“If US growth slows down next year, as expected, gold would benefit from higher demand for defensive assets,” Goldman’s analysts went on, calling current prices in commodities, oil and gold “[an] extremely attractive entry point”.
 
For 2019 “we are generally bullish on commodities,” agrees French investment bank Natixis, “mainly because we expect that a weaker Dollar and Chinese stimulus will help support demand.
 
“People are becoming a bit more worried about the Dollar,” adds Dutch bank ING’s Warren Patterson
 
“As we start seeing slowing growth in the US, we might see an upside in gold.”
 
Platinum and silver today joined Dollar gold prices near 2-week lows, falling to $830 and $14.10 per ounce respectively.

Comex Bears Split as Gold Prices Gain in UK and Euro Terms on Fresh Brexit and Italy Headlines

November 28, 2018
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GOLD PRICES held unchanged against a rising US Dollar on Tuesday, edging higher for UK and European investors as Brexit and Italy’s budget deficit again led the headlines.
 
With gold prices trading at last week’s finish of $1223 per ounce, China and European stock markets meantime fell after US President Trump told the Wall Street Journal it’s “highly unlikely” the White House will hold off raising import tariffs on $200 billion of goods to 25% despite his planned meeting with Chinese President Xi Jinping at this weekend’s G20 summit in Buenos Aires.
 
“When [such] concerns [over a trade war are] elevated,” says Australian bank ANZ’s bullion analyst Daniel Hynes, “investors have tended to seek haven in the US Dollar itself rather than gold.
 
“It has been an issue plaguing the gold market for a while now.”
 
Delayed by last week’s Thanksgiving holiday, new data from US regulator the CFTC showed overnight that hedge funds and other speculators cut their bearish bets against gold on Comex futures and options contracts faster than they cut their bullish bets as a group last week.
 
Altogether the so-called ‘Manged Money’ category stayed net negative on gold prices for the 19th week in a row.
 
Overall however, and including that Managed Money position, non-industry traders flipped back to positive after their first week of net negative betting in five.
 
Large non-commercial positions first broke away from the Managed Money’s net negative betting in mid-October, turning positive on gold’s steep rally from $1085.
 
Chart of Large Non-Commercials vs. Managed Money net position in Comex gold futures and options, notional tonnes equivalent. Source: BullionVault via CFTC
 
Managed Money traders also stayed bearish on silver prices for the 19th week in succession as of last Tuesday – the CFTC’s reporting date – trimming their net negative position to the equivalent of 5,056 tonnes.
 
That’s equal to one-fifth of annual world silver mine output.
 
Managed Money traders were meantime bullish on platinum for a 3rd week running, albeit with a net positive position equivalent to just 13 tonnes, some 6.9% of projected 2018 global mine output.
 
Platinum prices, like gold, today held unchanged in Dollar terms for the week so far, trading at $844 per ounce.
 
Silver however fell 3 cents to $14.25 per ounce.
 
The British Pound meantime fell near its lowest value of this month so far, pushing the UK gold price in Pounds per ounce up to the top of its recent range at £960.
 
Set to lose next month’s Parliamentary vote on her Brexit deal on declared positions, Prime Minister Theresa May today agreed to a TV debate on the terms for leaving the European Union with opposition Labour Party leader and long-time anti-EU politician Jeremy Corbyn.
 
Back on the currency market, the Euro today fell near 2-week lows versus the Dollar, buoying the gold price for French, German, Italian and Spanish investors to €1082 – barely 1% below late-October’s jump to 4-month highs.
 
After senior figures from Italy’s left-right coalition government hinted they could revise the 2019 budget deficit of 2.4% of GDP – saying “it is not a question of decimal places” – Prime Minister Giuseppe Conte issued a joint letter with them saying that “the objectives already fixed are confirmed.”

Gold Prices Firm as Crude Oil Bounces from 'Black Friday', GLD Shows Investor Inflows

November 26, 2018
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GOLD PRICES opened the week $5 higher on Monday morning as global stock markets rebounded with oil prices after last week’s ‘Black Friday’ plunge, writes Atsuko Whitehouse at BullionVault.
 
Oil prices clawed back 2% after dropping 8%, taking Europe’s benchmark Brent crude back up to $60 per barrel – a 13-month low when hit Friday.
 
European stock markets showed their best 1-day gain so far this month, led by banking and oil shares, and UK shares rose 1.2% after Prime Minister Theresa May secured approval for her Brexit deal from the remaining 27 European Union member states.
 
Spot gold prices meantime touched $1228 per ounce during Asian trade as Moscow slammed Kiev over what it called “provocation” by Ukrainian navy craft in the Black Sea.
 
With the United Nations’ security council holding an emergency meeting over the incident, the Nato military alliance called for “restraint”.
 
“People are moving some of their capital into gold at this point of time,” reckons Brian Lan, managing director at Singapore dealer GoldSilver Central.
 
“People see gold as a hedge against these uncertainties.”
 
The world’s largest gold-backed exchange-traded fund, the SPDR Gold Trust (NYSEArca:GLD), expanded by 0.4% last week as investors bought into the gold ETF.
 
That took its holdings up by 3.3 tonnes to almost 763 tonnes, the largest size in 3 months.
 
Chart of GLD gold backing. Source: BullionVault
 
With US Dollar gold prices down 6% from New Year 2018, the GLD has shrunk by nearly 9% year-to-date.
 
Italian shares meantime rose 3.1% in Milan on Monday after Rome’s left-right coalition said it will tweak Italy’s 2019 spending deficit plans in the face of Brussels’ rejection.
 
Alongside the UK’s withdrawal agreement – the “best and only deal possible” according to Prime Minister May – the remaining 27 EU leaders on Sunday published a separate statement vowing to protect their own interests on a range of issues from fishing to fair competition to the rights of citizens.
 
France’s President Emmanuel Macron warned Britain to share fishing rights in its waters and follow EU regulations or face being indefinitely trapped in the customs union as agreed in the “transition” deal.
 
The UK Parliament is expected to vote on the deal on 12 December, but its approval is far from guaranteed as Labour, the Lib Dems, the SNP, the DUP and many Conservatives MPs are set to vote against.
 
After Italy’s deputy prime minister Matteo Salvini hinted on Sunday at the possibility of tweaking the country’s deficit goal for next year, Rome’s 10-year borrowing costs fell over 22 basis points to a two-month low of 3.19%, and its spread over higher-rated German Bunds was at its tightest in over a month at 284 basis points.
 
Looking ahead this week, investors focus Federal Reserve speeches on Wednesday and policy-meeting minutes on Thursday that may give clues on the 2019 outlook.
 
US President Donald Trump then meets China’s Xi Jinping at the G20 summit in Argentina that kicks off on Friday.

Gold Price Boon for No.2 Miner Canada as Moscow Buys 85% of Russia's 2018 Output

November 23, 2018
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GOLD and SILVER prices held near 2-week highs against most major currencies on Thursday but platinum slipped back, trading down to $847 per ounce as European stock markets erased yesterday’s rally to fall back towards 2-year lows.
 
With gold prices at $1228 as US markets stayed shut for Thanksgiving, bullion in Euro terms held at €1076 per ounce.
 
Eurozone banking stocks fell over 1.0% as German giant Deutsche Bank became implicated in Denmark’s Danske Bank money-laundering scandal and Italy faced sanctions from the European Union over its 2019 deficit spending plans.
 
The Canadian Dollar meantime rallied from 5-month lows on the currency markets as crude oil steadied above this week’s new 13-month lows.
 
That pulled gold prices for miners in Canada – the No.2 producer nation behind China and ahead of Russia – back to C$1624 from Wednesday’s peak above C$1633 per ounce, the highest level since mid-July and .
 
Chart of Russia vs Canada gold prices. Source: St.Louis Fed
 
“With macroeconomic risk now being supplemented by concerns over systemic financial risk,” says Canada-based brokerage BMO Capital Markets, “we expect portfolio allocation towards gold to edge higher towards year end.”
 
Wednesday night’s rise in US Dollar gold prices came as hedge funds and other speculative traders closed their bets on gold prices ahead of the long Thanksgiving weekend reckons George Gero at RBC Wealth Management.
 
“Shorts are covering,” he told Kitco, pointing to the heavily bearish position currently held by Managed Money traders as a group overall.
 
With gold priced in Russian Rubles rising 142% so far this decade, No.3 gold producer-nation Russia mined over 231 tonnes in the first 9 months of 2018, new data said Wednesday, a rise of 1.7% from the same period last year. 
 
Over the same January-September period Russia’s central bank bought gold equal to 85% of that output, accelerating Moscow’s heavy accumulation of gold since US-EU sanctions first hit over the Kremlin’s role in Ukraine’s civil war, adding another 28 tonnes in October to reach new all-time record holdings of 2,075 tonnes.
 
Putting Russia at No.5 among national gold holders, that’s one-fifth smaller than France or Italy, two-thirds the size of Germany, and a quarter of the United States’ reported reserves.
 
The No.1 producer of palladium – the best-performing precious metal so far this decade, now up 3-fold in US Dollar terms since New Year 2010 – Russia this week signed an agreement with No.1 platinum miner South Africa to “promote the growth of the market of [those and other] platinum group metals through partnership and cooperation” according to the Tass news agency.
 
“Palladium will remain in a substantial deficit this year and for the foreseeable future,” reckons specialist consultancy Metals Focus, noting that “supply in 2018 is only looking at a rise of just over 10% since 2010 [because it] is mined in polymetallic ore bodies with the metal forming only a portion of total mine revenues.”
 
Platinum prices held flat on Thursday, trading unchanged for the week so far at $847 per ounce – down more than 43% so far this decade – as shares in would-be No.1 miner Sibanye-Stillwater (JSE: SGL) sank 5.6% after South Africa’s competition regulator approved its takeover of ailing Lonmin (LON: LMI) on condition of a 6-month freeze in any job cuts.
 
Silver meantime held steady with gold prices, showing a small gain for Thanksgiving Week at $14.51 per ounce.
 
That’s a drop of 14.3% from New Year 2010 for US investors. Gold prices have risen 11.9% over that time.
 
A bounce in Sterling on Thursday’s news of a Brexit “breakthrough” for UK Prime Minister Theresa May saw UK gold prices in Pounds per ounce erase the week’s prior 0.8% rise, trading back down to £952.
 
With EU national leaders set to review the UK’s exit deal this weekend, the core elements of post-Brexit relations on trade, security and other issues have been “agreed in principle” Brussels said.

Gold Prices Near 2-Week High as Italy 'Sleepwalks to Instability', US 'Ready to Evict' China from WTO

November 22, 2018
Latest News
GOLD PRICES rose near 2-week highs above $1225 in London trade Wednesday, adding $5 per ounce as the US Dollar slipped against other major currencies and European stock markets rallied from the latest slump in global equities.
 
White House advisor Kevin Hassett said overnight the US may push for China to be expelled from the World Trade Organization, looking “to evict” the world’s No.2 economy after it continued to “misbehave” on tariffs and other blocks to US imports.
 
Joining the WTO in 2001, China has grown its GDP almost 10-fold since then, with US exports to what is now the world’s No.2 economy rising 500% while US exports to the rest of the world rose 90%.
 
“[While] the current risk-off tone and flight toward the Dollar is weighing upon bullion price action,” says a note from Swiss refiners MKS Pamp, “the on-going trade tensions between the US and China are driving global equities lower and continue to underpin interest across the precious complex.
 
“Uncertainty over Brexit is also adding fuel to the fire.”
 
Euro gold prices rose Wednesday above €1075 per ounce for the 5th time in 6 sessions as the European Commission in Brussels confirmed it wants to take “excessive debt” measures against Italy over Rome’s planned 2019 budget – including a potential fine worth 0.2% of the country’s annual GDP.
 
“Italy is at risk of serious violation of the Council’s recommendation,” said EC vice-president Valdis Dombrovskis. “It is sleepwalking to instability. 
 
“I can not see how perpetuating [Italy’s] vulnerability can increase economic sovereignty. On the contrary, I think it will result in further austerity in the future.”
 
Rome’s cost of borrowing spiked and then fell back amid rumors that Rome may be open to revising its planned deficit of 2.4% of GDP.
 
Compared to Germany’s 10-year Bund yields, the BTP spread this morning hit 330 basis points for the second day running, nearing the 5-year gap seen earlier in 2018’s return of Italy’s deficit spending problems.
 
Chart of Italy's 10-year BTP yield spread over German Bund rates. Source: Il Sole 24 Ore
 
“Wild swings” in Italy’s bond prices have deterred even domestic savers from buying Rome’s latest issue of inflation-linked notes, the Treasury says, with demand so far totalling just one-fifth of the prior issue’s sales.
 
The UK’s 10-year borrowing costs meantime edged down towards last week’s 3-month low of 1.37% as Prime Minister Theresa May headed to Brussels to finalize her EU withdrawal agreement ahead of the weekend’s summit of the remaining 27 member states.
 
Scheduled for sign-off by the EU27, May’s Brexit deal was noisily rebuked by the majority of UK politicians discussing the issue again today in Parliament.
 
Silver meantime tracked gold prices higher on Wednesday, testing 2-week highs near $14.50 for a second day.
 
Latest UK export data say silver flows to India jumped to a 5-month high in September, notes specialist consultancy Metals Focus, bringing the year-to-date total up 227% from the first 9 months of last year at 1,709 tonnes.
 
Platinum retreated but also held a small gain for the week so far, trading up to $850 per ounce.
 
With the platinum price rallying from this summer’s new 15-year lows, exports of the metal from key refining, storage and dealing hub Switzerland rose in October to the heaviest monthly total since October 2014, new data show.
 
“Shipments to the United States, China and Italy rose sharply,” Reuters reports.

Gold Prices Touch 2-Week High as Trade War, Brexit and Italy Hit Stocks, Bitcoin Bounces from 34% Plunge

November 21, 2018
Latest News
GOLD PRICES rose to 2-week highs for Dollar and Euro investors on Tuesday and reached new November highs in terms of the British Pound as global stock markets fell sharply, extending yesterday’s 1.7% loss on Wall Street.
 
Reaching near $1229 per ounce, gold then eased back $5 as the Dollar rallied, keeping the Euro gold price above €1074.
 
“Trade tensions remain heightened between the US and China, global equities are under pressure, while Brexit negotiations continue to create uncertainty across markets,” says a trading note from Swiss refiners and finance group MKS Pamp.
 
“[That’s all] keeping gold’s safe-haven status intact.”
 
Spain said Monday it cannot ratify the EU’s exit agreement with the UK because Article 184 suggests the deal could prevent Madrid from demanding future negotiations with London over the status of Gibraltar.
 
Meantime in London, the DUP of Northern Ireland politicians – formerly in a coalition with Theresa May’s Conservative Party to give her a working majority in Parliament – abstained from voting on the Government’s finance bill over night.
 
That shows “the DUP is furious about the compromises that Number 10 has made [over the Irish border issue] to get their draft deal with the EU,” says the BBC.
 
Touching £957 this morning, the UK gold price in Pounds per ounce has now risen 6.5% since early October, when it briefly slipped below £900 per ounce – a new low following the mid-2016 Brexit referendum.
 
Chart of UK gold price in Pounds per ounce. Source: BullionVault
 
Looking at Dollar gold prices, “Any meaningful rally is likely a story for late 2019,” reckons Canadian brokerage T.D.Securities’ Bart Melek, head of global strategy.
 
“The US Dollar’s strength relative to [major economy] and [emerging-market] currencies is likely to remain a significant headwind that will suppress positioning for gold bugs.
 
“We expect prices to be well contained, before trending into the $1300s in the latter part of 2019.”
 
The Dollar rallied from 2-week lows against the Euro on Tuesday morning in London, recovering to $1.14 per Euro after Italy’s left-right coalition government said it may veto the European Union’s budget if Brussels doesn’t stop trying to force lower spending and higher tax on Rome’s domestic 2019 plans.
 
Contrary to most major European government bonds, Italian debt prices fell Tuesday, pushing the cost of borrowing up to the highest level since 2014 and blowing the 10-year BTP bond spread over German Bunds out to 330 basis points, back near the 5-year record hit this spring.
 
So-called “crypto currency” Bitcoin meantime found a floor around $4,200 overnight, finally stemming the last 5 days’ plunge of 34%.
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