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Gold Futures Steady on Soft Inflation, Cooling US Dollar

May 11, 2018 at 16:39 by Andrew Moran

Gold futures are trading flat to end the trading week. With soft inflation data and a weakening US dollar, gold prices held steady and are on track for a modest weekly gain.

June gold futures dipped $0.20, or 0.02%, to $1,322.10 per ounce at 16:19 GMT on Friday. The yellow metal, which had been seesawing between $1,310 and $1,320 all week, is poised for a tepid weekly jump of 0.46%.

Silver, the sister commodity to gold, is also relatively unchanged on Friday. July silver futures edged up $0.001, or 0.01%, to $16.76 an ounce. The white metal is poised for a weekly increase of 1.25%.

Gold is up by about 1% year-to-date, while silver is down more than 2%.

April consumer prices were weaker than expected, and the import price index climbed 0.3%, leaving some to suggest that the Federal Reserve may be a bit more cautious on its plans to raise interest rates in 2018.

The mild inflation boost sent the US dollar and bonds lower. The greenback fell 0.26% on Friday to 92.48, while the 10-year Treasury note yield slid to 2.96%. The buck will be flat on the week, but it is still in positive territory by 0.4% year-to-date. A weakening US dollar is good for commodities that are priced in the greenback because it makes it cheaper for foreign investors to purchase.

Investors are still paying attention to geopolitical affairs as tensions in the Middle East are brewing and President Donald Trump plans to meet with North Korean leader Kim Jong-un next month. Precious metals are traditionally seen as safe-haven assets.

Other metal commodities were mixed to finish the trading week. July copper futures rose $0.0035, or 0.11%, to $3.1135 per pound. July platinum futures slumped $1.20, or 0.13%, to $923.90 an ounce. July palladium futures slid $2.60, 0.26%, to $991.30 per ounce.

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