• April Comex gold futures settled Tuesday at $1,211.40 an ounce, up more than 1% on the day. With growing uncertainties surrounding the new administration, and accompanying stock market weakness, gold is proving to be a very attractive asset right now.
• In other precious metals, spot silver was up 2.6 per cent at $US17.55 an ounce after hitting the highest since November 11 at $US17.61.
"Silver has broken out of its established bearish channel to move above key resistance in the $US17.15/25range," said Fawad Razaqzada, technical analyst for Forex.com.
• Gold has jumped to a one-week high at $US1,215.37, highest since January 24, as unnerved investors buy bullion after the US dollar was hit by US President Donald Trump's comments on currency devaluation by other countries. It was on track to close January up 5.2 per cent, its strongest month since June.
• "Clearly Trump remains the main driver for gold. He has really turned from being a bit of a foe of gold to a friend with the uncertainty of his policies," Ole Hansen, head of commodity strategy at Saxo Bank in Copenhagen, said.
"We're not getting any news on fiscal spending and tax cuts. Instead, we're hearing about protectionism and a tough stance on immigration. That's unnerving the market."
• Gold and silver have room to move higher due to growing global uncertainty, at least that’s what the latest forecasts from London Bullion Market Association contributors suggests.
Gold has room to move 5% Higher as LMBA gold forecasters seen an average price of $1,244 an ounce for 2017Tuesday, the LBMA released is 2017 forecasts for the precious metals, with the analysts expecting average gold prices rising another 5% by end of year, standing around $1,244 an ounce. In the first half of the month, prices averaged around $1,181 an ounce.
“2017 will certainly be an eventful and unpredictable year given the high degree of geopolitical uncertainty, with a more nationalistic U.S. President in residence and the indications that the U.K. will pursue a hard Brexit in its negotiations with the EU,” the LBMA said in its report. “There is also the prospect of further uncertainty with elections to be held later in 2017 in both France and Germany, as well as the potential for tensions between the U.S. and China.”
On the downside, the analysts said that a stronger U.S. dollar and rising U.S. interest rates will weigh on the yellow metal.
While the forecasters are positive on gold, they are even more excited about silver, as they see the metal averaging $17.77 an ounce, up 7.1% from the average price of $16.59 an ounce recorded in the first half of this month. March Comex silver futures ended the session at $17.543 an ounce, up more than 2% on the day.
“On the upside, analysts cite geopolitical uncertainty and a stronger economic outlook boosting industrial demand (which accounts for more than half of physical consumption); of new solar plants, especially in China is likely to boost demand from the photovoltaic industry,” the LBMA said.
Reference: Business News, Kitco, Nasdaq
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