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Gold Posts Fresh 2018 Low Amid Market Havoc

June 25, 2018 at 18:53 by Andrew Moran

Gold futures posted fresh 2018 lows to kick off the trading week even as chaos impacts global financial markets. The yellow metal was unable to benefit from a slumping US dollar, falling Treasuries, and intensifying trade spats between the US and the rest of the world.

August gold futures shed $2.30, or 0.18%, to $1,268.40 per ounce at 18:27 GMT on Monday. This is the lowest settlement level for gold prices so far this year and are adding losses to last week’s dreadful performance. Gold is on track for a 3% dip in June.

Silver, the sister commodity to gold, is slipping to start the trading week. July silver futures declined $0.13, or 0.81%, to $16.33 an ounce.

All of the events that typically send gold and silver higher occurred on Monday.

The US dollar slipped 0.22% to 94.26. A lower buck is generally good for commodities priced in dollars because it makes it cheaper for foreign investors to purchase.

Treasuries, which usually trade inversely to gold, were in the red. The 10-year Treasury note yield decreased 0.6% to 2.88%, erasing a large portion of June’s impressive gains.

Equities markets were continuing last week’s downward spiral on Monday as the Dow Jones Industrial Averages (DJIA) cratered about 400 points. When the market is in that much turmoil, traders seek out safe-haven assets like gold.

Meanwhile, trade disputes between the US and its major trading partners intensified. Last week, the European Union (EU) started to impose tariffs on $3.2 billion worth of US imports, prompting President Donald Trump to threaten 20% tariffs on European automobiles coming into the US. President Trump, who will soon announce steps to curb Chinese investment in US technology businesses, called on the rest of the world to eliminate their “trade barriers and tariffs of be met with more reciprocity by the US.”

Positive economic news may have further harmed precious metals as May new-home sales data was better than what the market had anticipated.

In other metal commodities, September copper futures fell below the crucial $3 threshold as they tumbled $0.04, or 1.44%, to $2.98 a pound. October platinum futures slid $4.00, or 0.48%, to $871.00 per ounce. September palladium futures plunged $12.50, or 1.32%, to $934.10 an ounce.

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