The Daily Market Report: Gold Buoyed by Weak Dollar and Stocks

USAGOLD/Peter Grant/04-18-17

Gold has rebounded from modest intraday losses to pressure the 5½-month high at 1295.46 that was established yesterday in overseas trading. A weaker dollar and weaker stocks are helping to push the yellow metal higher.

Rising geopolitical tensions continue to contribute to safe-haven demand as well. Reports today suggest the U.S. military is considering shooting down North Korean missile tests. While that may display U.S. intercept capabilities, it just might further escalate the situation.

Russia is seeking to meet with U.S. and UN officials in Geneva next week, presumably to lessen deescalate the situation regarding Syria. However, a bilateral meeting last week between U.S. Secretary of State Rex Tillerson and Moscow yielded nothing.

U.S. data were mixed today, with housing starts for March disappointing and industrial production slightly exceeding expectations. The long U.S. recovery since the financial crisis remains uneven at best.

Last week’s dip in CPI has tempered June rate hike expectations notably. This is adding to pressure on the dollar, which took a hit based on President Trump’s perception that the greenback is too strong.

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