Gold Hits New Low for 2019

APMEX

1/21/2019 10:09:27 AM

Daily Gold & Silver Market Report – 1/21/2018

• Gold prices sink to new low mark for the year.
• Silver struggles to hold onto price gains. 
• U.S. dollar index up with  stock markets on holiday.

Prices for Gold fell Monday morning to the lowest seen this year. This drop was motivated by continued investor confidence in riskier investments, as China’s 2018 economic growth slowed to a near-30 year low. Investing.com reported fourth quarter GDP in China was down, growing at “the slowest pace since the global financial crisis.” Overall, China’s gross domestic product rose only 6.6 percent, the weakest pace since 1990. Some analysts suggested Beijing will need to leverage economic stimulus efforts to avoid a further downshift.

The declines affected both futures and Gold spot prices, although no floor trading occurred due to the Martin Luther King Jr. holiday. All Precious Metals, including Silver and Platinum, were also down as of 10:00 a.m. (ET). Palladium, which traded at record high levels last week, was down $23.30 to $1,359.80 per troy ounce, but still selling at a premium to Gold.

Silver Prices Struggle to Overcome Obstacles

While some predicted a Silver rally in 2019, these forecasts have yet to come to fruition. In a Bloomberg report published by MSN, financial journalists Joe Richter and Susanne Barton call Silver an “outcast” compared to the other Precious Metals. Silver has lost all 2019 gains while  Gold, Platinum and Palladium have mostly retained their strength. Last week, Silver futures showed the most substantial losses in several months.

Some analysts suggest Silver is being challenged on two separate fronts. First, buyers seem thus far uninterested in Silver as a safe-haven investment due to hopes that ongoing trade talks will result in a positive outcome. Secondly, as the manufacturing outlook for 2019 looks grim, buyers are not hopeful about any increased industrial demand in the near future. Daniel Ghali, a commodities strategist for TD Securities, said in the article that Silver has been “weighed down by slowing global growth concerns.” He adds that while some anticipate a “boost to prices because of increasing hopes of a U.S.-China trade deal... there’s still loads of inventory weighing on the metal’s price.”

U.S. Dollar Index Hits 3-Week Peak

While U.S. stock markets remained closed Monday morning, the dollar index reached a three-week high. Gold prices tend to slip when the U.S. dollar strengthens, as the Precious Metal becomes less desirable to those trading in other currencies. FXStreet points out the upward movement may be exaggerated by “thin market conditions due to the U.S. holiday,” and did not uncover a “clear catalyst” for the upward shift.

At 10:58 a.m. (ET), the APMEX Gold and Silver spot prices were:

• Gold, $1,282.70 Down $2.90
• Silver, $15.36 Down $0.10
• Platinum, $799.30 Down $2.80
• Palladium, $1,361.00 Down $22.10

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