The precious metals opened slightly higher again on Friday morning, charting a solid weekly gain. Spot gold has gained 1.2% this week, steadying at $1,245/oz in early trading this morning. The silver price, meanwhile, was up 0.3% (or +5¢ per ounce) on Friday, approaching $17.70/oz.
Platinum traded flat but palladium was more than 1.5% higher, extending beyond a 22-month high the metal hit yesterday.
The leading economic news on Friday was the release of durable goods orders for February, which showed an increase of 1.7% over the previous month, handily beating expectations. Analysts were only expecting orders to rise by 1.1%. Gold prices didn't show much of a reaction to the data, but this may be baked in to the mild profit-taking that gold has weathered this week. Though it's not surprising that traders have been securing profits on their gold positions with the past few weeks of rising prices, most indications are that demand for precious metals has remained strong nonetheless.
Battle in Congress
The story that is consuming much of the media's attention is the current healthcare bill, the American Health Care Act, slogging its way through Congress. With contradictory criticisms of the bill from both the House Freedom Caucus and Democrats, compromising on a bill that somewhat satisfies all sides has proven near-impossible. Without at least addressing the concerns of its own caucus, the GOP doesn't appear to have the votes to push the legislation through the House. Moreover, in its current form, the bill may not clear the Senate even if passed by the House.
All indications are that the White House still wants the bill to be voted on—as is—as soon as possible. It stands to reason that an overhaul of the country's broken healthcare system should be undertaken with careful deliberation rather than rushed through (as Obamacare was). However, the longer it takes for the AHCA to come to the floor for a vote, the more that the political capital needed to pass the bill bleeds away.
In other government news, President Trump has approved TransCanada's bid to construct the controversial Keystone XL pipeline. This should please much of his party as well as the energy sector. Crude oil prices ticked 0.2% higher on Friday.
The signs that the European Union may be on the road to economic recovery got a shot in the arm on Friday morning. The European PMI (purchasing managers index), a gauge of manufacturing activity, exceeded all expectations. The index registered its highest reading in about six years (April 2011). Most observers interpreted this data as supporting continued growth in the eurozone during this second quarter.
The euro was slightly firmer above $1.08 today. European stocks were mostly in the red this morning, however. Elsewhere, Asian markets closed higher overnight. Global demand for U.S. Treasurys eased somewhat, sending the 10-year yield up 3 basis points to 2.42%. The dollar continued to gradually concede ground to its peer currencies, hovering around 99.7 on the DXY.
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