The gold price was down again to $1,306/oz on Tuesday, sliding 0.6% (-$8). A stronger U.S. dollar provided most of the downward pressure on the precious metals.
Spot silver opened off about 0.5% (-9¢) to $16.21/oz.
Platinum lost $8 per ounce (-0.9%) to slip below $900/oz. Palladium fell by almost 1.6% (-$15) to trade at $945/oz.
Most Global Markets Closed for May Day
Exchanges all around Europe and Asia are closed in observance of the international workers’ holiday known as May Day. The main exceptions were Japan and the U.K.
Stocks were up 0.25% in London after a disappointing purchasing managers’ index (PMI) report for manufacturers drove the pound sterling 0.9% lower to $1.365, its weakest since January.
Equities in the eurozone last closed modestly higher. Shares were mixed overnight in Tokyo.
Meanwhile, the U.S. stock market continues to face headwinds.
Expected returns from equities have hit their lowest in 11 years—since before the last financial crisis.
This is despite rather strong earnings in the first quarter.
Wall Street opened in negative territory on Tuesday. The Nasdaq was down 0.2%, the S&P 500 dipped 0.25%, and the Dow Jones was off by 0.9%.
Silver was the only precious metal to post a monthly gain during April, advancing 0.8%.
On the month, gold slipped 0.6%, palladium lost 1.8%, and platinum tumbled 3%.
Yesterday’s upbeat personal consumption expenditures (PCE) index—the Fed’s favorite measure of inflation—is also pushing gold prices lower.
Precious Metals Largely Ignoring Fed, Trade, and Iran
The Federal Open Market Committee (FOMC) wraps up its two-day meeting tomorrow. No change to interest rates is expected because there is no post-meeting press conference scheduled. However, no formal rule prevents the Fed from hiking rates in the absence of a press conference. It’s merely unlikely.
The USD rose 0.6% to 92.4 on the DXY index on Tuesday, extending its rally.
The euro was down by the same proportion to $1.20, close to a four-month low.
Bonds saw little action as the 10-year yield was flat this morning at 2.95%.
Crude oil prices have surged in part due to increasing tensions between Iran and Israel (and by proxy the U.S.).
WTI crude and Brent crude each pulled back 0.7% this morning, but the former remains above $68 per barrel.
The stronger dollar held back most other commodity prices, as well.
Other geopolitical news, primarily the apparent détente between North and South Korea, has been more encouraging.
On the trade front, President Trump has decided to hold off on imposing certain tariffs against Europe, Canada, and Mexico until June 1.
Several other countries in the Western hemisphere have received permanent exemptions from Trump’s tariffs.
The EU and other major U.S. trade partners are aggressively seeking the same exemptions while tensions with China over trade continue to simmer beneath the surface.
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