• Gold prices edged higher Friday to post their largest weekly gain since mid-April, as overall declines in the U.S. dollar and equities from a week ago fed haven demand for bullion.
• The precious metal scored a roughly 2.1% advance for a week, marked by rising volatility and political unrest in the White House. That was the largest such gain since the week ended April 13.
• June gold GCM7, +0.17% tacked on 80 cents, or less than 0.1%, at $1,253.60 an ounce.
• “The stock market is starting to feel the heat, as President [Donald] Trump is receiving increased opposition left and right, which puts a drag on the prospects of his many plans,” said a team of analysts from Secular Investor.
“This worsened outlook has analysts adjusting their future earnings projections, which were lofty,” they said. “Lower earning forecasts translates into lower stock prices, plain and simple. Less money for stocks, provides room for alternative assets to shine.”
• Meanwhile, Carsten Fritsch and the commodities team at Commerzbank, pointed out in a research note that “it is not only the stock markets and bond yields that have fallen further amid the latest political events in the U.S.”
“In addition, the market now only rates the probability of the U.S. Fed raising interest rates at its next meeting in mid-June as being roughly 70%,” the analysts said. That’s down from nearly 100% odds priced in earlier this month. Higher rates tend to make gold, which doesn’t bear a yield, less appealing relative to other investments.
• Earlier Friday, in a speech at the Olin Business School in Missouri, St. Louis Fed President James Bullard questioned the need for a June rate increase. Bullard isn’t a voting member of the Fed.
• In other metals, July silver SIN7, +0.71% rose 12.6 cents, or 0.8%, to $16.796 an ounce.
Reference: Market Watch
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