Gold Price Rises to 8-Month High

APMEX

1/30/2019 12:29:03 PM

Daily Gold & Silver Market Report – 1/30/2018

• Gold futures traded at highest price in eight months. 
• Financial exec believes Palladium is driving Gold higher.
• Recent poll reflects expectation that Platinum will continue to struggle.

The price of Gold reached its best level in more than eight months Wednesday morning. As the U.S. Federal Reserve plans to announce new monetary policy decisions, investors expect to hear precisely how patient the central bank will be with further interest rate hikes. At the end of 2018, the Fed announced only two rate hikes were planned for 2019 but some market watchers now believe there may be none at all. Investing.com reported Comex Gold futures were up to their highest levels since May and spot prices were also up slightly. While analysts predicted mainly an economic slowdown, payroll service company ADP recently released a job growth report for January.

Safe-haven investments like Gold lose appeal with some investors when interest rates are on the rise, as bullion is not a yield-producing asset. An announcement that plans for rate hikes have been abandoned could lead to an even more significant boost for the yellow metal. The article also mentioned Venezuelan lawmaker Jose Guerra announced his country was shipping 20 tons of Gold bullion from its central bank reserve in an airplane marked with Russian wording. 

Palladium Wins May Be Helping Drive Gold Prices

In an interview on CNBC-TV18, one financial sector executive asserted high Palladium prices have been driving Gold upward. Probis Securities CIO Jonathan Barratt said, “Gold has certainly benefited ...  I get a sense it has been dragged up by Palladium and when I see the Palladium price in the way it moves - Palladium seems to be leading, and Gold and Silver seems to be dragged up as a result. Remember in Palladium, we do have quite a deficit in supply there, close to a million ounces.” Palladium is primarily used as a component of automobile exhaust systems, useful for reducing carbon dioxide emissions.

Reuters Poll: Palladium Prices will Leave Platinum Behind

While Gold prices are on the rise, Palladium has been selling at a premium to the yellow metal in recent weeks. However, a new Reuters poll of 29 analysts and traders reflects the forecast that Gold will regain the lead once again. As reported by Euronews, the survey also shows a general sentiment that Platinum will continue to struggle far behind Palladium regarding price. While Palladium has a significant supply deficit, Platinum has an estimated 455,000 ounces of surplus for 2019, according to the World Platinum Investment Council.

At 12:33 p.m. (ET), the APMEX Gold and Silver spot prices were:

• Gold, $1,313.60 Up $0.80
• Silver, $16.00 Up $0.10
• Platinum, $817.70 Up $0.90
• Palladium, $1,353.00 Up $7.40

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