Daily Gold Market Report

No DMR today, but we may update later at Today’s Top Gold News & Opinion if anything of interest develops. Yesterday’s report below.


Gold drops sharply as Treasury yields ominously resume climb

(USAGOLD – 3/3/2021) – Gold dropped sharply this morning as Treasury yields ominously resumed their climb in overnight markets. It is trading at $1713 – down $27. Silver is down 55¢ at $26.28. On the year thus far, gold is down 12% from $1942. Silver is down 3.75% from $27.20. Both metals, however, have experienced heavy physical demand during the decline. The World Gold Council recently reported the strongest January this century for American Eagle gold and silver bullion coin sales – a bellwether for overall retail investment demand. That strong demand continued through February as investors moved to insulate their portfolios against potential financial market difficulties they see as looming on the horizon – including another meltdown in the bond market and some sort of a corresponding policy response from the Fed. (For more detail, please see the March edition of News & Views: Will the Ides of March bring a market panic?)

Along these lines, HSBC’s James Steel believes gold will continue to play a key role in central bank reserves in the years to come for reasons that coincide with the thinking of a large portion of our clientele. “Gold,” he says in an essay published in The Alchemist magazine, “is likely to continue to be favored by central banks. Gold’s position in international finance is nothing short of unique. It is relatively rare but also liquid. It is a commodity and a currency. It is also the only recognized liquid financial asset that is not subject to counterparty risk. Unlike currencies, the value of gold does not depend on a national sovereign. More than any other type of investment, gold serves to ensure the capacity to act in extreme crisis situations.”

 Chart of the Day

Euro Area Central Bank Balance Sheeteurpean central bank balance sheet as Febrary 2021

Japan Central Bank Balance SheetJapan central bank balance sheet as of February 2021

United States Central Bank Balance SheetUnited States central bank balance sheet as February 2021

China Central Bank Balance SheetChina central bank balance sheet as of February 2021

Source: tradingeconomics.com

Chart note:  For the record, the charts on quantitative easing in various economies from over the past decade through Friday 2-26-2021. The most notable feature for Europe, Japan, and the United States is the ongoing pandemic-related surge. China is lagging on a relative basis, which might be one reason why the Chinese yuan has been in an upswing over the past several months.

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Market Data by TradingView Delayed data except FOREX

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