Metals Rise Modestly, Dollar Backtracks - Gainesville Coins News
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Metals Rise Modestly, Dollar Backtracks

blog | Published On 5/22/2018 10:01:56 AM by Everett Millman

balance of gold and dollarA slightly softer U.S. dollar gave the precious metals a boost this morning.

The gold price managed to poke back above $1,290 an ounce by yesterday's close. It inched higher on Tuesday to about $1,294/oz.

Spot silver rose 12¢ (+0.7%) to trade north of $16.60/oz.

Each of the Platinum Group Metals advanced, as well. Platinum moved back above $905/oz, gaining 0.7% (+$6). Palladium was up 0.9% (+$9) to about $995/oz.

Trade Remains in Focus, Dollar Dips

The greenback finally backed off a bit, but recovered from its overnight lows to trade just 0.1% lower on the DXY.

Accordingly, forex trading was mostly quiet.

Markets trained their attention on the ongoing trade negotiations between China and the United States.

China reportedly cut its duties on automobile imports from 25% to 15%. Meanwhile, the U.S. delegation continues to push the Chinese government to increase the amount of energy and agricultural products the country imports from America.

The Chinese yuan has rallied to begin this week to 6.37 per dollar.

Elsewhere in the global "trade war," President Trump is seeking greater concessions from the European Union (EU) before committing to exempt the bloc from steep tariffs on steel and aluminum.

Most commodities benefited from the breather for the dollar.

WTI crude added 0.1% to $72.30/bbl while Brent crude rallied 1.0% (+80¢) to hit $80/bbl. Copper jumped more than 1.3% to $3.14 per pound.

The 10-year yield remained largely steady at 3.07%, up about one basis point.

Congress Plans to Help Out the Banks

After months of being lobbied to do so, the House of Representatives is set to adjust aspects of the 2010 Dodd-Frank legislation that placed tighter regulations on the banking sector.

The proposed changes would raise the threshold for a bank to be deemed "systemically important" from $50 billion in assets to $250 billion.

This congressional action may be followed by an overhaul of the so-called Volcker Rule, named after the former Fed Chairman Paul Volcker, which restricts commercial banks from engaging in proprietary trading and certain forms of speculative activity.

While both moves are intended to ease the regulatory burden on large- and medium-sized banks, Minneapolis Fed President Neel Kashkari expressed doubt about what problem this relief will solve—given that major banks continue to log record profits.

Stocks edged higher on Wall St. The small-cap Russell 2000 looked to build upon another fresh all-time high.

European indices were higher across the board, led by the DAX (+0.9%).

However, Asian stocks fell overnight with the exception of the Hang Seng (+0.6%) in Hong Kong.

The FTSE 100 rose about 0.3% despite factory output in the U.K. falling to its lowest in about two years.

It was the worst reading of the country's manufacturing sector since before the Brexit vote in Summer 2016.

 

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.

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