Commodity Blog

Commodity news, technical and fundamental analysis, market data on precious metals, energies, industrial metals, and soft commodities


Gold Hovers Around 3-1/2 Month High Ahead of Donald Trump Speech

February 27, 2017 at 18:05 by Andrew Moran

Gold futures are hovering around their highest levels since November 10 as markets brace for US President Donald Trump‘s speech to Congress on Tuesday. The yellow metal is also garnering support from the lack of commitment from the Federal Reserve to raise key interest rates next month.

April gold futures climbed $4.60, or 0.37%, to $1,262.90 per ounce at 16:38 GMT on Monday. Gold is trading at its highest level three-and-a-half months. Gold is looking to record its third consecutive session gain as it posted its fourth straight weekly gain of 1.5% last week.

Silver is also mustering up a rally. March silver futures rose $0.08, or 0.44%, to $18.42 an ounce. Silver reported its ninth straight weekly gain last week as it advanced 1.7%.

The precious metals are benefiting from the uncertainty surrounding the US president’s speech to a joint session of Congress on Tuesday. He is expected to outline his plan over the next year, which may include his first budget proposal, infrastructure spending, middle class tax cuts, and making US companies more globally competitive. Experts are also hoping that Trump will make his border adjustment tax, or import tax, more clear.

Meanwhile, traders are becoming increasingly frustrated over the US central bank’s refusal to commit to a rate hike next month. The next Federal Open Market Committee (FOMC) meeting takes place on March 14 and 15, but most expect a rate hike to be postponed until June. This delay may be good for the yellow metal because a rising rate environment makes commodities like gold and silver less attractive as investors flee to yield-bearing assets.

Both US reports sent the greenback lower as it shed 0.2%.

Investors are also concerned about the growing uncertainty in geopolitics. Europe will hold several elections in the coming months, including in France, The Netherlands, and Germany, which are three nations where the populist sentiment is surging. France’s Marine Le Pen and Holland’s Geert Wilders are both at the top of the polls.

If you have any questions and comments on the commodities today, use the form below to reply.

Leave a Reply