Monthly Commentary

June 2019

Precious metals surged in June, with gold reaching a six-year high of just under $1,440.00 and finishing the month up 8.0%.  Silver finished June up 4.7%, posting its first monthly increase since January.  Platinum and palladium performed well too, finishing up 5.5% and 12.9% respectively.

The first half of June saw a modest rise in precious metals brought on by increasing global growth concerns.  The U.S. and China continued to lob threats of new tariffs at each other and weak economic data out of China showed the impact tariffs were already having.  The U.S. also threatened tariffs against Mexico in response to its current immigration policy which helped boost gold to a 14-month high of $1,350.00.  This global tension coupled with weak jobs data that suggested U.S. growth was slowing forced the Fed’s hand in entertaining the idea of a 2019 rate cut as soon as July.  The U.S. dollar plunged and metals, primarily gold, surged amid the Fed’s dovish tone.  Gold reached its highest level since 2013 and had its best monthly performance since 2016.

U.S. equities had their best month in decades, propelled upwards by the increasing likelihood of a rate cut in 2019.  The Dow rose about 7%, its best monthly performance since 1938 and the S&P 500 and the Nasdaq rose 6.2% and 6.9% respectively.

Historical Trends & Pricing

Commentaries

August 16, 2019

Gold and silver both dipped from their multi-year highs that were reached earlier this week as stocks continue to rebound from one of their worst weeks of 2019 on renewed stimulus hopes from several central banks.  Even with the decline, gold is still set to end the week up over 1%.

August 14, 2019

Gold and silver both rebounded from yesterday’s dip as the 10 year and 2 year treasury yields inverted for the first time since 2005, which has historically been a precursor to a recession.  Gold is up nearly 2% from yesterday’s low and equities are plunging as recession fears grow. 

August 12, 2019

Gold and silver both climbed today amid ongoing tension between the US and China.  The Chinese Central Bank set its currency slightly above the 7:1 ratio the US deems appropriate, leading to continued worries of currency devaluation.  Stocks are down to begin the week with the Dow, S&P 500, and the Nasdaq all trading about 1% in the red. 

August 9, 2019

Gold is teetering around $1,500 today after rising 3.4% this week on renewed trade war fears and weak earnings from Wallstreet.  Silver spent most of the day right under $17.00 after rising as high as $17.25 earlier this week.  Stocks are set to end the week down, but have recovered significantly from their Wednesday lows.

August 07, 2019

Equity markets continue to get slammed as weak earnings and ongoing strife with China are causing investors to jump ship in search of safer investments.  The sell-off has sent metals soaring and bond yields falling to a three-year low.  Gold and silver are currently trading at $1,506.40 and $17.07 respectively.

 

August 05, 2019

Gold is currently trading at $1,464.00, its highest level since March 2013, after China devalued its currency leading US-China relations to a new low during the trade war.  Equities are plummeting on the news, both globally and domestically.  The Dow, S&P 500, and Nasdaq are all down at least 2% midday with the Nasdaq getting hit hardest at 2.75%.      

August 2, 2019

Gold is holding steady above $1,440 after rebounding yesterday amid increasing trade tension with China.  After sharply dropping Wednesday during Jerome Powell’s less dovish than expected press conference, President Trump’s statement regarding new Chinese tariffs caused equities to plunge and gold to soar.  The Dow is currently down nearly 2.8% from this week’s high, and on course for its second worst week of 2019. 

July 31, 2019

Gold is down slightly, currently trading at $1,424.40, after getting a boost yesterday when the Bank of Japan announced it would hold rates but promised future easing if economic conditions worsened.  Now, investors are looking to the Fed which is expected to cut rates by 25 basis points.  U.S. equity markets are trading relatively flat ahead of the Fed’s decision.

July 29, 2019

Gold and silver are trading at $1,420.00 and $16.40 respectively,  as much of the volatility seen in recent weeks has subsided ahead of a big week for economic news.  The Bank of Japan is set to release its monetary policy on Tuesday, then the Fed will release its decision on Wednesday.  Key manufacturing and employment data are also due out later in the week. Stocks are mixed midday with the Dow up about 0.22% and the Nasdaq down about 0.55%.

July 26, 2019

Gold is currently up $3.60 at $1,418.00 as it tries to find direction amid divergent economic data. The ECB held interest rates steady but promised future easing due to slowing growth. Meanwhile, the Fed is expected to cut rates next week, but positive economic data yesterday and today may influence the extent of the cut.  Jobless claims, durable goods orders, and Q2 GDP all beat estimates. The U.S. dollar is trading at a 2-month high even as the Fed is likely to cut interest rates for the first time in over a decade next week.

 

July 24, 2019

Gold is up slightly midday, hovering around $1,423.50, as weak economic data out of Europe comes one day before the ECB meets to discuss monetary policy.  The ECB is expected to modify its forward guidance tomorrow to make room for a rate cut in September.  This should provide some insight into next week’s Fed decision where rates could drop 25 or 50 bp, or remain unchanged;  however, most predictors point to a 25 basis point cut next Wednesday. 

 

July 22, 2019

After dipping nearly 2% on Friday, gold has found support around the $1,425.00 level as increasing tension between Iran and the UK and the U.S. helped boost metals as a safe haven asset, but much will depend on how the U.S. responds to Iran seizing a British oil tanker in the Strait of Hormuz. Silver, which is currently up $0.23, continues to chip away at the gold to silver ratio. The ratio has been as high as 93 in recent weeks but is now right around 86.9.

July 19, 2019

Precious metals continued its bullish run this morning as gold surpassed a six year high in early morning trading on COMEX.  Towards the close, gold would finished down slightly as profit taking materialized.  Gold gained $7.50 (+0.53%) for the week.  Silver, on a similar but more aggressive track, finished at its highest level in a year and gaining $0.95 (+6.26%) for the week.  With a week full of various contributing news cycles from potential rate cuts / lower Dollar here in the U.S. to increased tensions with Iran, both metals are seeing fresh interest through both economic and other global factors.   

July 17, 2019

Gold is up $12.50, trading at $1,421.70, its highest level in over two weeks, as the US dollar dipped after the IMF said US currency was overvalued. Silver, which has lagged behind during gold’s recent spike, is now outperforming gold, up nearly 4% in the past two days.

July 15, 2019

Gold is trading at $1,411.00, up about $1.00, as negative GPD data out of China is offset with positive manufacturing data of the United States.  2019 second quarter GDP grew 6.3% in China, its lowest level year over year in 27 years.  The New York Fed’s Empire State manufacturing survey index rose 12.9 points to a positive 4.3, beating estimates by nearly 3 points.

 

July 12, 2019

Gold remains comfortably above its $1,400.00 support level as Jerome Powell’s testimony this week showed the Fed remains more dovish than many investors had predicted in light of positive employment data earlier this month.  Stocks continue to break new records based of the same sentiment that’s driving metals up; the S&P 500 hitting 3,000 for the first time ever and the Dow poised to set a new record today, currently trading 0.50% up.

 

July 10, 2019

Gold is trading at $1,410.00, rebounding from Friday’s dive after Jerome Powell emphasized in his congressional testimony that the U.S. economy still faces several challenges, pointing to growing trade tension and global economic growth specifically.  U.S. stocks are up across the board as well, gaining momentum on renewed hopes for a rate cut in July.

July 8, 2019

Gold broke $1,400 again earlier today before retreating to its current level of $1,394.60. The drop comes as excellent employment data last week greatly decreases the likelihood of a Fed rate cut later this month. US stocks, which priced a rate cut into their recent surge, are down today following Friday’s jobs numbers. Fed Chair Jerome Powell is testifying before Congress this week to deliver his semi-annual Monetary Policy Report which should provide greater insight into where the Fed stands on future policy.

 

July 05, 2019

Gold dropped 1.5% this morning as stronger than expected jobs data boosted treasury yields and the U.S. dollar.  The U.S. dollar index (DYX) is up 0.50% midday and the ten-year treasury yield broke 2% as 224,000 jobs were added in June, beating expectations by over 50,000 jobs.  Silver is down 2.2%, dipping below $15.00 for the first time in three weeks.

July 03, 2019

Gold is up $12.90, currently trading at $1,417.70, wiping away most of its losses sustained earlier this week as ADP employment data came in softer than expected.  102,000 private sector jobs were created in June, falling well short of the forecasted 140,000.  Stocks continue to soar during today’s shortened trading session with the Dow currently trading about 100 points higher than its October 3 record closing price and the S&P 500 sitting comfortably above yesterday’s record high.

July 01, 2019

Gold dropped below $1,400.00 on renewed trade hopes between the US and China after a fairly successful meeting between President Trump and Xi this weekend.  The US dollar is up 0.60% after the meeting, its highest level in nearly two weeks.  Equities, which have surged recently on the likelihood of a rate cut, are also up on the renewed trade optimism, despite what it likely means for interest rates.  Even with its recent drop, gold finished June up over 7%, its best monthly performance in 3 years.

June 28, 2019

Gold is up slightly, currently trading at $1,411.90 ahead of Presidents Trump and Xi’s meeting this weekend where either a trade deal or increased tension are viable outcomes.  Inflation data released this morning shows it’s still well below the Fed’s 2% target, adding fuel to the argument for a rate cut next month, however, the outcome of tomorrow’s meeting will likely play a much larger role in determining Fed policy in July. 

June 26, 2019

Gold dropped slightly after Secretary of the Treasury Mnuchin suggested trade relations with China are improving and a deal looks likely in the near future.  Stocks rose modestly on the news with the Dow and Nasdaq gaining 0.35% and 0.70% respectively.  Even with the slight dip, gold is holding steady around $1,414.00, up over 8% in June, and on course for its best monthly performance in three years.

June 24, 2019

Gold is up $21.50 today, currently trading at $1,417.90 as the US dollar continues to fall and is now sitting at a 3 month low.   The likelihood of an interest rate cut continues to increase amid current trade relations with China and now new sanctions aimed at top Iranian officials.  President Trump and President Xi will meet later this week, which should provide some insight into the direction the  U.S. and China relations are heading.

June 21, 2019

Gold breaks $1,400 for first time in nearly six years!  Gold’s August futures price reached $1415.40 in overnight trading for the first time since September 2013 as oil prices surged due to increasing tension between the US and Iran after Iran shot down a US drone in international space.  Gold has retreated slightly but is holding steady in the $1395 range and is still up over 7% in June as investors continue to digest the Fed’s dovish tone and the increasing likelihood of a rate cut in July.

June 19, 2019

Gold is holding steady in the $1,345.00 range,  ahead of today’s decision on interest rates.  The Fed is expected to keep rates unchanged, but Jerome Powell’s press conference should provide insight into their policy moving forward.  Stocks are up slightly ahead of today’s FOMC announcement, with the Dow gaining 50 points midday. 

June 17, 2019

Gold is trading at $1,341.00, its movement has become much less volatile ahead of Wednesday’s FOMC rate decision and Fed Chair Powell’s ensuing press conference that should set the tone for future Fed policy.  U.S. stocks, which have been moving in unison with the price of gold the last few weeks (as both react positively to the likelihood of a rate cut) are up slightly as well, ahead of this week’s meeting.

June 14, 2019

Gold broke $1,350.00 this morning, reaching a 14-month high as weak economic data out of China showed industrial output grew only 5% in May, well below estimates and its lowest level in 17 years.  US retail data released today, showed consumer spending rose in May, and more importantly April’s numbers were adjusted to show much higher spending than originally reported.  While a sign of a healthy economy, stocks are down slightly on the strong retail data since it will most likely be an argument against cutting interest rates in next week’s Fed meeting. 

June 12, 2019

Gold is trading at $1,332.00 after rebounding over $10.00 from yesterday’s low,  brought on by Friday’s trade agreement between the US and Mexico. Tomorrow’s consumer price index should provide a greater sense of current inflation after today’s producer price index suggested it was well contained and could be a factor in determining Fed policy at next week’s meeting. 

June 10, 2019

To begin the week, gold and silver fell as the US and Mexico reached a trade agreement to avoid tariffs.  Stocks are up on the news even though the trade agreement could decrease the likelihood of an interest rate cut,  which was the primary factor driving equities higher  last week. 

June 07, 2019

Gold has settled down around $1,335.00 after posting its best single week performance of the year, rising over 3% since last Thursday.  Friday’s employment data is particularly important amid the Fed’s recent dovish attitude and the increasing likelihood that any negative economic data could influence a rate cut.  

June 05, 2019

Gold is trading at $1,226.00, its highest level since February as comments by Fed Chair Jerome Powell hinted at possible rate cuts this year.  Stocks also rose sharply with the Dow gaining over 500 points Tuesday, its best single day performance since January. 

June 03, 2019

Gold continues its surge beginning the week currently trading at $1,312.00, its highest level in over two months as proposed tariffs against Mexico and increasing trade tension with China continue to slam equities.  Dow futures are down 140 points after already falling to its lowest level since January on Friday. 

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