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Gold, Silver Futures Flat as US Political Situation Stabilizes

February 17, 2017 at 17:55 by Andrew Moran

Gold and silver prices are flat on the final trading session of the week. After a week of top news stories, including US President Donald Trump’s solo press conference and Federal Reserve Chair Janet Yellen‘s two-day trip to Capitol Hill, the precious metals were relatively unchanged on Friday.

April gold futures dipped $2.40, or 0.19%, to $1,239.20 per ounce at 16:25 GMT on Friday. Gold was able to record its third consecutive weekly gain as the yellow metal advanced 0.4%. This was the precious metal’s weakest weekly gain since the middle of October.

Silver was unable to muster any rally. March silver futures tumbled $0.02, or 0.16%, to $18.04 an ounce. This comes one day after silver settled at its highest price since November 10. Silver did also post another weekly gain as it climbed a tepid 0.4%.

Gold and silver are steadily adding to their values in 2017. Year-to-date, gold prices have increased more than 7% and silver has jumped more than 13%.

The precious metals decided to stay quiet as the US political situation stabilized. The US president delivered his first solo press conference, an event that garnered a tremendous amount of coverage because of his interactions with the media. He announced Alexander Acosta as the new Secretary of Labor, attacked the media, and conceded that he “inherited a mess at home” in regards to the national economy.

Meanwhile, the Fed Chair spoke to the House of Representatives and Senate and defended the central bank’s record on monetary and bank regulatory policy. She did reaffirm that the Fed has still penciled in three increases to interest rates this year, despite the amount of uncertainty surrounding the new administration and the upcoming elections in Europe.

Gold is sensitive to rising interest rates because it lifts the opportunity cost and prompts investors to flee into yield-bearing assets.

Losses that gold did incur were attributed to a rising US dollar. A strong dollar is bad news for commodities like gold and silver because it makes it more expensive for foreign investors to buy.

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