Gold Continues Safe-Haven Rally - Gainesville Coins News
No Minimum order! We accept Pay with Credit Card
Call Us: (813) 482-9300 Mon-Fri 9:00AM-6:00PM EST
Login or Register
Log into your account
About Gainesville Coins ®
Billions Of Dollars Bought And Sold A+ BBB Rating 10+ Years No Hidden Fees Or Commissions All Inventory Ships Directly From Our Vault

Gold Continues Safe-Haven Rally

blog | Published On by
Gold Continues Safe-Haven Rally

gold-rally-market

The precious metals continued to benefit from rising tensions around the globe, particularly with North Korea. The gold price traded as high as $1,295 an ounce overnight before traders took some profits. When markets opened in New York on Monday morning, spot gold was down just $1 per ounce to $1,287/oz.

Spot silver was also off slightly, losing 3¢ per ounce to $18.50/oz. Platinum was actually 0.7% higher, while palladium lost 0.5%.

Chinese Economy Roars Back

The big economic news on Monday was the report of first-quarter gross domestic product (GDP) in China. It appears that the Chinese economy grew at a 6.9% pace during Q1, its best since 2015. This represents the type of extraordinary growth that China became accustomed to over the last 20 years or so—but many believed to be a thing of the past.

china-flag-shanghai

However, there was some skepticism toward the fantastic headline number. China is still perhaps relying too heavily on its world-leading steel industry and an overheated property market to continue generating such unbelievable growth. In other words, this doesn't seem to change the narrative of China's gradual economic slowdown: at some point, as the country transitions from a production-oriented economy to a more consumption- and service-based model, the high levels of government investment in infrastructure and real estate will have to unwind. Chinese steel production hit a record-high in March while demand for the metal slipped, suggesting a possible supply glut on the horizon.

The Shanghai Composite index still lost over 0.7% during last night's trading session.

Other Market Movement

The U.S. dollar remained weaker on Monday, continuing last week's trend. The USD fell to a three-week low against its major peers, losing 0.3% on the DXY index for a reading of 100.2. This has also mirrored the impact on the bond market, as investors search for some safe harbor away from the uncertainty over North Korea and Syria. The 10-year Treasury yield was just 2.23% this morning, its lowest since November. Declining bond yields have coincided almost perfectly with rising gold prices (see chart below).

The dollar was also dragged lower by the strong drop seen in the most recent New York manufacturing data. All of this sets up to continue to support gold prices, likely through the $1,300/oz threshold.

European markets, along with markets in Australia, Hong Kong, and New Zealand, remained closed today in observation of the Easter holiday. Expect some lower trading volumes on Monday as a result.

 

The opinions and forecasts herein are provided solely for informational purposes and should not be used or construed as an offer, solicitation, or recommendation to buy or sell any product.

About the Author

Everett Millman

Everett Millman

Analyst, Commodities and Finance
Managing Editor

Everett has been the head content writer and market analyst at Gainesville Coins since 2013. He has a background in History and is deeply interested in how gold and silver have historically fit into the financial system.

In addition to blogging, Everett's work has been featured in CoinWeek, Advisor Perspectives, Wealth Management, Activist Post, and has been referenced by the Washington Post.

This site uses cookies for analytics and to deliver personalized content. By continuing to browse our site, you agree that you have read and understand our Privacy Policy.