Spot Gold Steady on Eve of Korea Summit - Gainesville Coins News
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Spot Gold Steady on Eve of Korea Summit

blog | Published On 6/11/2018 9:52:31 AM by Everett Millman

With a busy week on tap, the precious metals were little changed to begin trading Monday.

The gold price held steady around $1,298 per ounce, struggling to break past resistance.

Spot silver was up 4¢ (+0.25%) to $16.81/oz. Palladium added 0.8% (+$8) to $1,012/oz while platinum was unchanged at $905/oz.

Precious Metals Pause Ahead of Busy Week

This week is packed with events that have a strong potential to move markets.

Tomorrow kicks off the summit between the U.S. and North Korea in Singapore. It would be the first time in history that the heads of state of the two countries have ever met.

The summit is still seen as a highly combustible development, and markets will be watching closely.

Meanwhile, the Federal Reserve holds its next meeting this week. Most analysts expect the Fed to raise interest rates when the FOMC gathering ends on Wednesday. The Fed has been treading the line between being dovish and hawkish as it forecasts its approach to interest rates.

Other central banks are also making policy decisions this week. The European Central Bank (ECB) meets on Thursday, followed by the Bank of Japan (BOJ) on Friday.

Stocks were barely higher in Asia overnight. European equities were also up modestly this morning.

After closing higher Friday, Wall St was largely flat in early trading Monday.

Treasurys didn't see strong demand. The 10-year bond yield rose two basis points to 2.97%.

Bears Lurk for Emerging Markets

Overall, uncertainty in developed markets has caused gold (and most other financial assets) to move sideways of late. That's why this week's central bank meetings and Korean summit could spark considerable volatility.

Emerging markets have endured their own woes. Central banks in Pakistan, Turkey, India, and Brazil have been raising rates to stave off currency devaluation. The same is true in Argentina despite the country agreeing to a $50 billion loan from the International Monetary Fund (IMF).

These currencies in emerging markets have taken a beating despite a slight pullback for the U.S. dollar. The DXY index was flat at 93.5 this morning.

The pound sterling lost 0.2% against the USD. The euro was up 0.2% to nearly $1.18 while the yen slid 0.3% to about ¥110 per dollar.

Most commodities traded sharply lower. There is now a double-digit spread between the two crude oil benchmarks. WTI crude slumped 1.1% to $65/bbl and Brent crude was down 1.0% to $75.65/bbl.

Several indicators point toward copper entering a bull market. This would have the effect of boosting silver output from mines, as silver is a major byproduct of copper mining.

In the cryptocurrency sphere, the hack of a major South Korean bitcoin exchange sent prices tumbling. BTC sank below $6,800.

 

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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