Today’s AM LBMA Gold Price was $1,214.75, €1,063.59 and £768.91/oz.
Yesterday’s AM LBMA Gold Price was $1,193.00, €1,062.43 and £761.55/oz.
Gold traded sideways in Asia overnight and gold in Singapore was firm at $1,214.10/oz near the end of day trading. Gold and silver appeared to consolidate in early trading in London on the sharp gains seen after the poor U.S. retail sales number yesterday.
Gold and silver are both near a five week high after climbing on the weak U.S. retail sales data that heightened concerns that the Fed would not raise interest rates soon – something we have said would likely happen. The U.S. dollar fell in value against other currencies on the news and is weak again today – particularly against silver and the Swiss franc.
Gold is being supported by jittery bond markets, rising bond yields and dollar weakness this week.
Recent economic data, including the retail sales number yesterday, has been more negative than positive. This is contributing to volatility in bond markets and some selling pressure in equity markets. There are increasing concerns about the economic outlook globally.
The U.S. dollar has come under further pressure and remained at three month lows today after the poor retail data proved a huge disappointment to those expecting a strong economic rebound from a weak first quarter – blamed on the weather.
German and U.S. bond yields surged to their highest in over five months as a vicious selloff extended to its tenth session. The startling rise in yields has made equities look more expensive in comparison to government debt and kept stock markets subdued.
Gold prices may benefit if there is a supply disruption from South Africa due to South Africa’s Association of Mineworkers and Construction Union (AMCU) pay rise dispute. The AMCU are seeking basic pay for entry-level workers in the gold mining industry to be more than doubled, which means difficult negotiations and perhaps a strike which we saw in the platinum sector last year that lasted five months.
In late morning European trading gold is up 0.32% at $1,220.54/oz. Silver is up another 1.2% at $17.40/oz. Palladium and platinum are up 0.15 and 0.26% at $790 and $1,150.00/oz respectively.