Daily Gold & Silver Market Report – 2/4/2016

Marcey Hollon

2/4/2016 11:01:57 AM

GOLD HITS THREE-MONTH PEAK; U.S. RATE OUTLOOK KEEP OIL STRONG

Gold climbed to a three-month high Thursday on comments from New York Federal Reserve Chair William Dudley concerning the tightening of the U.S. economy, as he stated the weakening global outlook and tightened financial conditions could have “significant consequences.”  Weak U.S. services sector data along with Dudley’s comments diminished any expectation of the Federal Reserve raising interest rates in March. "The (Fed funds futures) now sees only a 12 percent probability of a rate hike in March, so I am not expecting the price of Gold to drop soon," Natixis analyst Bernard Dahdah said. Volatility in global markets has helped Gold gain 8 percent since the beginning of the year.  Investors will watch for Friday’s non-farm payroll report as a weak showing could sustain the dollar’s sell off and further boost Gold.

News of the possibility of the Fed not raising interest rates in 2016 have given the dollar a blow and helped global stocks rally. The U.S. dollar fell 0.7 percent against a basket of other currencies. The struggling dollar along with the possible production cuts by oil producing countries have helped  Brent crude oil prices gain 35 cents. "The dollar is on its knees," Richard Benson, head of portfolio management with currency fund Millennium in London, said. "Probably we will now have some stability ahead of U.S. payrolls tomorrow."

 

At 12:00 P.M. (ET), the APMEX Precious Metals spot prices were:

• Gold, $1,156.30 Up $13.00
• Silver, $14.92 Up $0.14
• Platinum, $901.90 Up $21.80
• Palladium, $513.6000

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