Gold is sharply higher this morning in New York, hitting a three-month high as it pulls the other three big precious metals along with it. Gold prices began building during early trading in London, despite a rally in the US dollar. The DXY dollar index began falling before the New York open, putting further support underneath precious metals.
Wall Street opened lower, pressured by a drop in oil prices spurred yesterday after the American Petroleum Institute announced a massive 14.2 million barrel build in US crude stockpiles. This was 568% higher than the 2.5 million barrel build that analysts were expecting.
In the Platinum Group Metals (PGMs), spot platinum was up by $11.00 an ounce, leaving April futures nearly flat with a $1.00 gain. Palladium, which has been the best-performing precious metal in 2017, was $4.00 higher in the spot market, and $1.00 higher on the COMEX futures exchange.
Gold prices have been affected by political uncertainty in Europe, especially regarding France and Greece. On a more positive sentiment, the disruptions in India caused by Narendra Modi's "war on cash" are abating, and gold jewelry sales have picked up for this wedding season.
The DXY dollar index has been bouncing below recent highs for some time now. Christopher Vecchio, writing at DailyFX, warns that the dollar hasn't managed to establish a bottom just yet. Much like stocks, the dollar is being buffeted by conflicting sentiment regarding several different policies being considered by the Trump administration.
Oil prices were rocked this morning when the US Energy Information Administration back up the API's numbers released yesterday, reporting a massive crude build of 13.8 million barrels for the week. Looking below the headline numbers, traders decided that news of a 900,000 barrel draw on gasoline reserves counteracted that huge jump in crude stockpiles. A gasoline glut had markets concerned, as it was feared that refineries would reduce their crude demand as gas storage tanks filled.
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