Category: Snapshot

Morning Snapshot: Gold Adopted More Positive Tone Within Range This Week

USAGOLD/Peter Grant/11-10-17

Gold is slightly lower after having set 3-week highs in the previous 2 sessions. The yellow metal is garnering support from a modest pullback in the dollar and softer stocks, as doubt arose about the prospects for timely passage of the GOP tax reform legislation.

The Senate version delays the corporate tax cuts until 2019 and has more tax brackets than the House version. There is some concern that reconciliation is going to be contention and may prevent the legislation from reaching the President’s desk before year-end.

If the Trump administration fails to notch a significant legislative victory this year, any remaining momentum they have may be lost. That might put Republican congressional majorities in jeopardy next year, signalling the end of Trump’s pro-business, reflation agenda.

If that is the way things unfold, the U.S. stock market would be vulnerable to a serious correction. Safe-haven assets like gold would come back in favor and one might reasonably expect the Fed to reverse recent policy tightening.

Today’s U.S. calendar includes preliminary consumer sentiment for November and October Treasury budget. Next week’s data has October PPI and CPI. Both are expected to remain soft, which may raise some doubts about the true prospects for a December rate hike.

While gold adopted a more positive tone this week within the well-defined range, a convincing move back above $1300 is still needed to return a measure of confidence to the uptrend that has dominated most of this year. On the downside, support is well defined at 1263.00/1260.10.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold Edges Higher to Another 3-Week High

USAGOLD/Peter Grant/11-09-17

Gold is up modestly in early U.S. trading, buoyed by a weaker dollar and a drop in stocks. The yellow metal has set a new 3-week high at 1288.19. Silver remains narrowly confined within the recent range, trading just above $17.

The next minor tier of resistance for gold is at 1291.08. A breach of this level would bode well for further tests above $1300.

Initial jobless claims for last week were higher than expected. Later today we’ll see September wholesale sales. There will also be a $15 bln 30-year bond auction.

Posted in Gold News, Gold Price, Gold Views, Silver News, Silver Price, Silver Views, Snapshot |

Morning Snapshot: Gold and Silver Firmer Within Recent Ranges

USAGOLD/Peter Grant/11-08-17

Gold is higher in early U.S. trading, probing the high end of the range within the range within the range. That first tier of resistance is marked by last week’s high at 1284.20. Above that, 1306.04 and 1357.50 define the high ends of the broader ranges. The low end of the ranges are well defined at 1263.00/1260.10

Silver is higher, trading just above $17. Resistances to watch are at 17.26 and 17.47. The latter is likely a trigger for a push back above $18.

Today’s calendar is very light with only EIA crude data from last week. There is a $23 bln 10-year note auction as well.

Posted in Gold News, Gold Price, Gold Views, Silver News, Silver Price, Silver Views, Snapshot |

Morning Snapshot: Gold Ease Slightly Within Range

USAGOLD/Peter Grant/11-07-17

Gold is slightly lower today after yesterday’s late surge stalled shy of last week’s high at 1284.20. A breach of this level is needed to clear the way for renewed probes above $1300.

Continued dollar strength is helping to keep gold in check. The dollar index edged to a new 15-week high in overseas trading. Risk aversion associated with the Saudi corruption crackdown and President Trump’s trip to Asia are seen as underpinning the precious metals.

Silver gave back more than half of yesterday’s solid intraday gains overseas, but is back trading above $17 presently. The mid-October high at 17.41 is seen as key short-term resistance. Supports we’re watching at at 16.59 and 16.30.

Today’s economic calendar has JOLTs job openings for September, IBD/TIPP Economic Optimism Index and consumer credit. We’ll also hear FedSpeak from Janet Yellen and vice-chair Quarles.

Posted in Gold News, Gold Price, Gold Views, Silver News, Silver Price, Silver Views, Snapshot |

Morning Snapshot: Gold Edges Up Within Range Following NFP Miss

USAGOLD/Peter Grant/11-03-17

Gold is up slightly this morning, nonplussed by the NFP miss and still locked within the recent range. The dollar index remains narrowly confined as well near its 3-month highs, which is helping to limit the upside for the yellow metal. Silver is up as well, maintaining recent gains above $17.00.

U.S. nonfarm payrolls rose 261k in October, below expectations of +318k and whispers in the neighborhood of +400k. As I said in commentary yesterday, forecasters set a pretty high bar, creating the risk for disappointment. September NFP was revised higher from -33k to +18k, so at least the negative print is off the books. The unemployment rate ticked down to 4.065%.

So after a terrible number in September and a smaller than expected post-Hurricane rebound in October, how is it that the jobless rate ticked lower? Zerohedge explains:

…the number of people who exited the labor force soared by a near record 968,000 in October – the third highest on record – pushing the total number of people not in the labor force to a record 95.385 million, as the civilian labor force shrunk by whopping 765,000 in one month. — Zerohedge

Average hourly earnings came in unchanged for October, below expectations of +0.2%. The annualized rate of wage growth slowed to 2.4%.

Some are claiming this should be attributed to hurricane disruptions, but the chart presented by Bloomberg suggests that wage growth was meeting resistance ahead of 3% long before this hurricane season. This is something the Fed is likely to be watching very closely going into year-end, because if already tepid wage growth has stalled, it does not bode well for the inflation pressures that Fed keeps contending are just around the corner.

Posted in Gold News, Gold Price, Gold Views, Silver News, Silver Price, Silver Views, Snapshot |

Morning Snapshot: Gold remains consolidative within recent range

USAGOLD/Peter Grant/11-02-17

Gold is maintaining a consolidative tone at the low end of the range that has dominated for the past several weeks. Markets are awaiting the release of the House tax plan as well as President Trump’s nomination of the next Fed chair.

The House plan is expected to be focused on a permanent cut to corporate taxes, from 35% to 20%. Additionally, the number of individual income tax brackets are to be cut and the estate tax will be repealed. However, the devil is in the details and those details are likely to have significant implications for the national debt.

Fed Governor Jerome (Jay) Powell is widely anticipated to be nominated to replace Janet Yellen as Fed chair. Powell is a centrist and is likely to perpetuate the current policy tact.

Yesterday’s Fed policy statement did nothing to curtail expectations of a December rate hike. Fed funds futures put the probability at 97%, even though inflation remains below target.

A lot of focus will also be placed on tomorrow’s release of October jobs data. The market is anticipating a sizable rebound in nonfarm payrolls of 318k, following September’s surprising negative print.

As for today’s U.S. data, it has been generally positive with a better than expected rise of 3.0% in Q3 productivity (prelim) and bigger than expected drop in initial jobless claims.

The BoE raised rates by 25 bps today. It was the first hike in a decade and they indicated that 2 more would be needed during the next two years to control prices. With UK inflation running above target, this one may have made some sense, but some are already expressing concern that the BoE is being “too upbeat.”

Sterling has firmed, which is helping to check the upside in the dollar. That in turn, may help to underpin gold investment.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold firms within range

USAGOLD/Peter Grant/11-01-17

Gold is higher within the range, but remains limited by a firm dollar and stocks. The market is awaiting the Fed’s policy decision later today.

The Fed is expected to hold steady, keeping the December rate hike on the table. However, it might be worthwhile to temper tightening expectations going into year-end, just to give themselves some leeway in the event that inflation fails to pick up.

The ADP jobs survey came in stronger than expected, perhaps creating some upside risk for Friday’s nonfarm payrolls report. Expectations are presently +318k, with the unemployment rate holding steady at 4.2%.

Later this morning we’ll see manufacturing PMI and ISM, construction spending, EIA crude stocks and domestic car and truck sales.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold retreats back into range as dollar firms on weaker yen

USAGOLD/Peter Grant/10-31-17

The consolidative tone in gold persists as the dollar remains firm and stocks rebound. The yellow metal still needs to climb back above $1300 to ease short-term pressure on the downside.

The BoJ left the policy rate unchanged at -0.1%, kept 10-year JGB rates capped “around zero” and will maintain the QE pace of ¥80 trillion per year. Despite optimism about both growth and inflation, guidance remains dovish. That pressured the yen, buoying the dollar in the process.

The Fed begins their two-day FOMC meeting today. When policy is announced tomorrow, no change is expected. While a December rate hike will remain on the table, it might behoove the central bank to start tempering those expectations; unless they truly believe inflation is on the verge of rebounding.

Expressed concern about the ongoing absence of inflation — which is the reason they paused in September — would likely halt the recent rise in the dollar. With the ECB, BoC and BoJ maintaining their dovish guidance, it might be in the best interest of the Fed to hint that the pause might be perpetuated into 2018.

Posted in Gold News, Gold Price, Gold Views, Snapshot, Today's top gold news and opinion |

Morning Snapshot: Gold remains range bound to begin busy week

USAGOLD/Peter Grant/10-30-17

Gold starts the week as it ended, consolidative within the recent range. The dollar is a little easier, as are stocks, with risk appetite tempered somewhat ahead of this rather busy week.

The first indictments in the Russian collusion investigation are occurring today. Former Trump campaign chairman Paul Manafort and his aide Rick Gates are supposed to turn themselves in to the FBI today.

The Fed’s two-day FOMC meeting commences tomorrow. No change to policy is anticipated, but markets will be looking for further clarification of the central bank’s intentions for December. The BoJ and BoE meet this week as well.

Today’s U.S. data are a mixed bag. Personal income and consumption jumped in September. However, core PCE inflation was up a scant 0.1%. The Fed still has an inflation problem, which was the primary reason they paused the tightening cycle in September.

Politico is reporting that President Trump will make his nomination for the next Fed chair on Thursday. They reported last week that the field had narrowed to John Taylor and Jerome Powell.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold remains defensive at low end of recent range

USAGOLD/Peter Grant/10-27-17

Gold remains defensive at the low end of the recent range, weighed by heightened risk appetite and a stronger dollar. Support in the yellow metal is well defined by the 1260.10 (06-Oct low).

U.S. advance Q3 GDP came in better than expected at 3.0%, essentially unchanged from +3.1% in Q2. This will help justify persistently elevated expectations for a December rate hike, even though the absence of inflation continues and that’s the “mystery” that prompted the Fed to pause in September.

The BoJ faces the same problem with October CPI coming in at +0.7% y/y. Don’t expected any move toward tighter policy anytime soon.

The dollar is rallying based on anticipated widening of interest rate differentials. Most of the world continues to lean toward easier policy, while the U.S. is in the midst of a tightening cycle (Sep pause notwithstanding). These dollar gains are keeping a lid on gold for now.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

The Morning Snapshot: Gold remains consolidative below $1300

USAGOLD/Peter Grant/10-26-17

Gold continues to consolidate below $1300 after ECB policy came in as expected: Steady on rates and smaller QE for longer. Mario Draghi’s press conference is ongoing.

U.S. initial jobless claims rebounded 10k last week, but the print was still below expectations. The trade gap widened in-line with expectations.

There are reports circulating this morning, citing Politico, that Janet Yellen and Kevin Warsh are out of the running for Fed chair. That may mean that the field has narrowed to John Taylor and Jerome Powell.

The dollar index is probing back above 94.00, buoyed by a dovish ECB and the resulting weaker euro. That is keeping gold defensive. Political and geopolitical tensions continue to provide support.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold steadies as dollar gains stall

USAGOLD/Peter Grant/10-25-17

Gold is maintaining a generally consolidative tone within the recent range, as gains in the dollar index stalled ahead of head of important resistance at 94.00/14. The yellow metal needs to reclaim $1300 to ease short term pressure on the downside and return confidence to the dominant uptrend.

A better than expected Q3 GDP print for the UK sparked a rebound in Sterling, amid reinvigorated hopes that the BoE will raise rates next week, for the first time in more than a decade. This has weighed on the dollar.

U.S. data today were generally positive with durable goods orders, new home sales and home prices all beating expectations. The Bank of Canada will announce policy today (steady expected) and the ECB is up tomorrow.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold retreats into range as stocks lurch higher

USAGOLD/Peter Grant/10-24-17

Gold has retreated into the range once again as stocks lurch higher. The dollar is firmer this morning as well, but solid resistance in the dollar index at 93.99/94.14 remains intact.

Political and geopolitical tensions continue to be seen as supportive for the yellow metal. The government of Catalonia is expected to respond to Spain’s demands on Thursday. Japan’s Defense Minister categorized the North Korea threat as having “grown to the unprecedented, critical and imminent level.”

Today’s U.S. economic calendar is light today with Markit PMIs for October and the Richmond Fed index. Tomorrow the BoC will announce policy, followed by the ECB on Thursday.

Both policy decisions and the guidance will be interesting, as recent data — particularly weak inflation — may have derailed tightening plans. If easier policy prevails, the Canadian dollar and euro may come under further pressure.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold remains defensive to start week

USAGOLD/Peter Grant/10-23-17

Gold remains under pressure as risk-appetite remains elevated, driving global shares higher. Last week’s passage of a 2018 budget resolution by the Senate further stoked hopes for President Trump’s proposed tax cuts.

Spanish Prime Minister Mariano Rajoy said over the weekend that he would seek to dissolve the Catalonian government under Article 155, thereby ending the region’s autonomy. The EU fell in line with Spain’s central government. However, Catalan foreign affairs spokesman Raul Romeva said, “the people and the institutions in Catalonia will not let this happen.” It would appear that a showdown is brewing.

Shinzo Abe has consolidated power as a result of the weekend snap election. Abe-nomics will continue, but he is also expected to modify Japan’s pacifist Constitution so that he can “deal with North Korea.” Japan needs to be able to defend itself, but this could mark the beginning of a new Asian arms race.

The U.S. calendar is very light today. The highlight of this week will be the ECB rate decision on Thursday.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold softens as advancement of budget/tax reform stokes risk appetite

USAGOLD/Peter Grant/10-20-17

Gold is back on the defensive within the range after the Senate narrowly passed the 2018 budget blueprint by a 51-49 vote. This bolsters hope that the GOP proposed tax reform will be advanced as well, prompting a rebound in risk appetite; as reflected by higher stocks.

Yields have rebounded as well, pulling the dollar higher, which has in turn pressured the yellow metal. The budget blueprint allows $1.5 trillion to be added to the deficit over the next 10-years. This is one of the keys to President Trump’s tax cut, borrow and spend reflation agenda.

Geopolitical risks are likely to limit the downside. Spain is expected to terminate Catlonia’s autonomy tomorrow. CIA Director Pompeo and National Security Advisor McMaster both seemed to suggest a heightened possibility of a military confrontation with North Korea at a security forum on Thursday.

The U.S. calendar is light today with just September existing home sales (-0.9% forecast) and Treasury Budget for September. We’ll also hear FedSpeak from Mester and Yellen.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold jumps as Spain prepares to revoke Catalonia autonomy

USAGOLD/Peter Grant/10-19-17

Gold is rebounding today and has already exceeded yesterday’s high amid reports that Spain will move to rescind Catalonia’s autonomy today. This unprecedented move has sapped risk appetite, weighing on global shares and pushing yields and the dollar lower.

Spanish PM Mariano Rajoy said that Article 155 would be invoked today, asserting direct rule over Catalonia. Rajoy says Spain seeks to “restore the constitutional order.” Put another way, this move seeks to crush the independence movement, but I doubt the separatist will go quietly into the night.

Again, it’s interesting to watch the dollar come under pressure at times of heightened geopolitical tensions. There was a time, not so long ago, when the dollar was THE safe-haven currency. That is no longer the case.

U.S. economic data were mixed this morning. Initial jobless claims fell 22k last week. The Philly Fed index for October came in much better than expected. However, leading indicators fell 0.2% in September, below expectations of +0.1%.

We’ll hear FedSpeak from Ester George later this morning as well, as prospects for a December rate hike remains elevated.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold remains defensive as dollar/yields rise

USAGOLD/Peter Grant/10-18-17

Gold remains defensive after recent gains above $1300 faltered as talk about a potentially hawkish replacement for Janet Yellen began to circulate. That story continues to play out this morning, buoying yields and the dollar and pressuring the yellow metal.

As I wrote in yesterday’s DMR, appointing a hawk like John Taylor to chair the Fed risks derailing any hope that President Trump’s reflation agenda gets off the ground. What Mr. Trump really needs is an unabashed dove like Janet Yellen, or as DoubleLine Capital’s Jeff Gundlach speculated last week, Neel Kashkari.

U.S. housing starts and permits plummeted in September, well below the expectations of analysts who were already expecting a hurricane related slow down. Later today we’ll see EIA crude stocks and the Beige Book. FedSpeak from Dudley and Kaplan is already trickling out of a moderated discussion on economic development.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold retreats into range as dollar firms

USAGOLD/Peter Grant/10-17-17

Gold retreated into the range after failing to sustain recent probes above $1300, as the dollar firmed. However, political and geopolitical risks are still seen as supportive underpinnings to this market.

U.S. trade prices came in hotter than expected for September, with a 0.7% gain for imports and a 0.8% rise in export prices. Higher energy prices associated with the hurricanes contributed to the rise in import prices. While these gains may prove temporary, these data bolster the position of the policy hawks on the FOMC calling for a December rate hike.

Look for the probability of a rate hike to go back above 90%, which is pushing the dollar higher. However, with expectations already all-but a sure thing, there’s not much more room for improvement and gold has been holding up pretty well. There’s also still plenty of time before that December meeting.

U.S. industrial production rose 0.3% in September, in line with expectations, versus an upward revised -0.7% in August (was -0.9%). Cap use edged up to 76.0%, from a negative revised 75.8% in August (was 76.1%).

Later this morning we’ll see the NAHB housig market index for October, Treasury budget for September and August TIC data. We’ll also hear FedSpeak from Philly Fed’s Harker.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold firm above $1300

USAGOLD/Peter Grant/10-16-17

Gold remain well bid above $1300, having ended last week on an upswing. The next technical hurdle is defined by resistance at 1308.80/1313.62. A breach of this level would return confidence to the dominant uptrend.

The dollar index is modestly higher, but momentum on recent uptricks has been lackluster. Fed funds futures suggest the probability of a December rate hike remains near 90%. These factors are limiting the upside.

North Korea has renewed its threat to fire missiles toward Guam as U.S. and South Korean forces begin new naval drills. Spain is still waiting for clarification from Catalonia as to whether they declared independence or not last week. If they did, or they do not respond by Thursday, Spain has threatened to impose direct rule.

The U.S. calendar is light today. NY Empire State index surged to an 8-year high of 30.2 in October, well above expectations of 20.0, versus 24.4 in September. September Treasury budget is out this afternoon

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold pops back above $1300 after data

USAGOLD/Peter Grant/10-13-17

Gold jumped back above $1300 after a tame core CPI print for September, shows that the Fed continues to face an inflation problem. Headline inflation rose 0.5%, the biggest m/m jump since January, but it was still below expectations of +0.6% and attributed to hurricane distortion.

Like PPI yesterday, higher energy prices in the wake of the recent hurricanes pushed the broader measures of inflation higher. However, these gains are unlikely to be sticky.

This morning’s gains put the yellow metal decisively back above the entire 20-, 50-, 100- and 200-day moving average complex, returning considerable credence to the underlying uptrend. Next resistance is at 1308.80, the halfway back point of the decline off the September peak at 1357.50.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold re-approaches $1300

USAGOLD/Peter Grant/10-12-17

Gold re-approached the $1300 level in overseas trading, buoyed by heightened geopolitical tensions and a toppy-looking dollar. The yellow metal has retreated modestly intraday in the wake of warmer than expected inflation data.

U.S. PPI rose 0.4% in September, stoked by hurricane distortions and in line with expectations. Core PPI jumped +0.4% as well, which was above expectations of +0.2%.

Initial jobless claims fell 15k last week, suggesting that the hurricane effect on labor may already be reversing. However, it remains to be seen if that will be sufficient to reverse the existing downtrend in payrolls that had developed long before this hurricane season.

A move back above $1300 would put gold above the 20- and 50-day moving averages, returning confidence to the dominant uptrend. The halfway back point of the recent correction comes in at 1308.80.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold consolidates below $1300

USAGOLD/Peter Grant/10-11-17

Gold is consolidating below the $1300 level as traders await the minutes of the September FOMC meeting. Geopolitical tensions and a softer dollar are seen as being supportive to the yellow metal.

The Fed paused the recent tightening cycle in September amid persistently sluggish inflation. The minutes will perhaps provide some additional clarity as to just how concerned the members are and if current market expectations for a December hike are realistic.

Recent gains in the dollar index stalled well shy of the 100- and 200-day moving averages. The trend is still down and negation of this 92.90/88 support level would return considerable confidence to that trend, which should push gold higher.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold more than $30 off Friday’s low

USAGOLD/Peter Grant/10-10-17

Gold extended to the upside in overseas trading amid rising geopolitical risks and mounting concerns that the President is going to have difficulties passing tax reform. The yellow metal is up more than $30 since hitting an 8-week low at 1260.10 on Friday.

Catalonian President Puigdemont is slated to address parliament today and is expected to declare independence from Spain, or at least a movement toward independence. Spanish PM Rajoy has vowed that “Spain will not be divided” and that he is prepared to employ “all means” within the law to preserve national unity.

Bloomberg has reported that Spanish National Police are in place and prepared to arrest Puigdemont. If the Catalan police attempt to shield Puigdemont, there is the risk of violence. However, it is the longer-term and broader implications for Spain and Europe that are of concern to markets.

The Hill reports this morning that based on recent rhetoric, Kim Jong Un may believe that a U.S. decapitating strike is imminent. That may prompt the North Korean leader to launch a preemptive strike.

There is growing concern that President Trump’s tax reform plan is losing momentum. This had been a big driving force in the stock market rally as investors salivated over the proposed corporate tax cut. This is a must-win issue for the President, given the failure of repeal-and-replace and the lack of progress on immigration reform and the the wall.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold firms on geopolitical risks, “startling” drop in U.S. payrolls

USAGOLD/Peter Grant/10-09-17

Gold starts the week at a 5-session high after finding support on Friday at the 1260.00 level in the wake of September’s negative nonfarm payrolls print. Heightened geopolitical tensions are also providing support to the yellow metal.

St. Louis Fed President James Bullard called the negative NFP number “startling” and said more data were needed before committing to a December rate hike. Nonetheless, Fed funds futures continue to suggest the probability of a rate hike is all-but a sure thing.

There will be quite a bit of FedSpeak again this week. We’ll see if anyone else is troubled by the deterioration in the labor market. As noted in commentary on Friday, the trend in payrolls rolled over long before this hurricane season.

Geopolitical tensions are on the rise again amid expectations of an impending North Korean missile tests. The UK is reportedly developing a war plan as such a test may result in a U.S. military response.

The Treasury market and the Fed are closed today for Columbus Day. However, Chinese investors are back in the mix after the long Golden Week/National Day holidays.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold defensive as markets shrug-off weak jobs data as weather distortion

USAGOLD/Peter Grant/10-06-17

Gold remains defensive, edging to a new 7-week low as the market seems inclined — at least initially — to shrug off the weak headline jobs data as hurricane distortion. The dollar index reached a 10-week high, modestly exceeding the August high at 94.15.

U.S. nonfarm payrolls fell 33k in September, well below expectations of +87k, versus a positive revised 169k in August (was +156k). July was revised down to 138k, from 189k previously.

While the hurricanes clearly affected the data in September, payrolls began trending lower earlier in the year, before the bad weather rolled in. This may in reality not be transitory at all. So the question now is, how will the Fed view the data? They will likely be encouraged by the beat in earnings.

There is FedSpeak from Kaplan, Bostic, Dudley and Bullard today, so we won’t have to wait long for the central bank’s initial spin. In fact, Dalls Fed hawk Kaplan has already indicated on CNBC that he’s “not there yet” with regard to a December hike, but is open minded.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold consolidates ahead of tomorrow’s NFP data

USAGOLD/Peter Grant/10-05-17

Gold is consolidating within yesterday’s range as the market looks ahead to tomorrow’s jobs report. Solid resistance in the dollar index has capped the upside thus far, which is helping underpin gold as well.

U.S. initial jobless claims fell 12k last week as hurricane affects work there way through the system. However, a soft 87k rise in nonfarm payrolls is anticipated for September, with perhaps some downside risk based on the ADP jobs survey miss yesterday.

Recent strength in PMI data has pushed December rate hike expectations back above 80%, but weak jobs data could reverse that bias. If rate hike expectations dim again, look for the greenback to retrace recent gains, shich should bolster gold.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold firms as dollar retreats from resistance

USAGOLD/Peter Grant/10-04-17

Gold firmed in overseas trading after the dollar backed off its recent highs. While some of the yellow metal’s gains have already been retraced, the dollar is up against a formidable resistance level and is quite overbought.

The U.S. ADP jobs survey came in below expectations, weighed by weather affects. This sets up some downside risk for the already weak September nonfarm payrolls expectations.

Reuters is reporting that Catalonia will declare independence from Spain on Monday. Does Mariano Rajoy and the government of Spain allow that to happen? Given the violence already used in an effort to squelch the referendum, will they go so far as to shut down the Catalonian Parliament?

Jeff Gundlach is predicting that Neel Kashkari will be the next Fed chair. “He happens to be the most easy money guy that’s in the Federal Reserve system today and that’s why he may win,” said Gundlach. That’s the exact reason that I thought he might seek to reappoint Yellen and why Kevin Warsh was an unlikely candidate. Easy policy and a weak dollar would certainly make execution of President Trump’s economic agenda more likely to be successful.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold remains soft near 6-week lows

USAGOLD/Peter Grant/10-03-17

Gold is trading in a narrow range, having edged to a new 6-week low overseas. Heightened risk appetite and December rate hike expectations have sparked a rebound in the dollar over the past three-plus weeks, which has weighed on the yellow metal.

Today’s economic calendar is very light with just September auto sales. Traders may already be looking ahead to Friday’s jobs data. Median expectations for nonfarm payrolls is just +87k. The unemployment rate is expected to hold steady at 4.4%.

Additionally, Chinese markets are closed this week for the Golden Week holiday, which is likely sapping Asian demand. This year they are calling it a “Super” Golden Week because the Mid-Autumn Festival coincides with the National Day holiday. China’s tourism administration says they expect about half of the 1.3 billion population to be on the move this week.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold maintains defensive posture to begin the week

USAGOLD/Peter Grant/10-02-17

Gold remains on the defensive after Friday’s soft close. The yellow metal is being weighed by a rebound in the dollar to challenge last week’s highs and revived risk appetite amid investor hopes for U.S. tax cuts.

Dollar gains are primarily associated with euro weakness in the wake of the Catalonia referendum that has thrown Spain — and the broader EU — into crisis.

Today’s calendar includes Markit manufacturing PMI and U.S. manufacturing ISM for September, as well as construction spending for August. We’ll also hear FedSpeak from Dallas Fed hawk Kaplan.

While the geopolitical rhetoric between the U.S. and North Korea is still flying, the recent absence of new DPKR missile and nuclear tests has pushed the still percolating conflict off the front page. South Korea is anticipating that fresh North Korean provocations are in the offing for this month.

Posted in Gold News, Gold Price, Gold Views, Snapshot |

Morning Snapshot: Gold firms as core PCE inflation hits 2-year low

USAGOLD/Peter Grant/09-29-17

Gold is modestly firmer as the dollar continues to retrace recent gains. In the wake of yesterday’s simple hook reversal (lower low, higher close), some upside follow through would be expected as shorts take profits ahead of the weekend.

U.S. personal income rose +0.2% in August in line with expectations, tempering optimism that sprang from the +0.4% print in July. PCE rose 0.1%, also in line with expectations. Core PCE — the Fed’s favored measure of inflation — fell to 1.29% y/y, a two-year low.

The PCE data further erodes the weak inflation is “transitory” meme, bolstering Janet Yellen’s self-assessment that she and her colleagues may have “misjudged” on inflation. Today’s data should temper December rate hike expectations, helping gold.

Posted in Gold News, Gold Price, Gold Views, Snapshot |