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Gold Logs Weekly Loss on Upbeat US Economic Data, Capped by Geopolitics

November 22, 2019 at 18:32 by Andrew Moran

Gold futures slipped on Friday as prices logged a modest weekly loss, driven primarily by upbeat economic data emanating from the US. But gold’s losses were capped by geopolitical events that are making safe-haven assets more appeal to risk-averse investors. A surging greenback further affected precious metals’ performances at the end of the trading week.

December gold futures tumbled $1.10, or 0.08%, to $1,462.50 per ounce at 17:10 GMT on Friday on the Comex division of the New York Mercantile Exchange. The yellow metal is set to record a weekly decline of 0.4%. Despite its stellar performance at the end of the summer, the metal commodity has slipped nearly 3% over the last month. So far this year, gold is up 14%.

Silver, the sister commodity to gold, is also in the red to close out the trading week. December silver futures fell $0.08, or 0.47%, to $16.985 an ounce. The white metal is poised for a weekly gain of 0.3%, though it has shed about 6% since the middle of October. Year-to-date, silver has risen 9%.

Upbeat economic data is primarily hurting the metals market on Friday.

The IHS Markit manufacturing purchasing managers’ index (PMI) came in at 52.25 in November, up from 51.3 in October, which is the fastest pace in six months. The November flash services PMI posted a reading of 51.6, up from 50.6 – the best expansion since July.

In other data, the University of Michigan’s US consumer sentiment index for November was 96.8, up from 95.5 in October. The market estimate was 95.7.

Meanwhile, geopolitics appears to be limiting gold’s losses. In addition to the US-China trade dispute, Great Britain has a general election on December 12 and the results could impact the country’s withdrawal from the European Union. Also, the US government passed legislation that would give the president the power to rescind Hong Kong’s special status.

A surging US dollar contributed to gold’s woes as the greenback rose 0.27% to 98.26, from an opening of 97.93. The dollar will enjoy a weekly jump of 0.25%. YTD, the currency is up 2.2%. A stronger buck is bad for dollar-denominated commodities because it makes it more expensive for foreign investors to purchase.

In other metal markets, December copper futures climbed $0.023, or 0.88%, to $2.6465 per pound. December platinum futures cratered $23.80, or 2.59%, to $893.70 an ounce. December palladium futures added $12.00, or 0.69%, to $1,743.90 per ounce.

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