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Gold Stays Flat Ahead of US Presidential Debate

September 26, 2016 at 17:22 by Andrew Moran

Gold prices stayed flat on Monday as investors prepare to witness the first debate of the US presidential election.

December gold futures rose a tepid $2.10, or 0.16%, to $1,343.70 per ounce at 16:55 GMT. Despite finishing Friday’s trading session in the red, gold recorded a weekly gain of 2.5%. The yellow metal received a boost from the Federal Reserve holding off on raising interest rates on Wednesday and further weak economic data, both in the US and around the world.

Silver experienced declines on Monday. December silver futures dipped $0.24, or 1.24%, to $19.56 an ounce. Silver also had a strong trading week last week as it advanced 5% and went above $20 an ounce.

The precious metals have had a strong 2016 so far. Gold has climbed 23%, while silver has risen 40%.

Although gold still remains strong, new data from the US Commodity Futures Trading Commission (CFTC) show that hedge funds and money managers have reduced their net long position in gold for two consecutive weeks. This comes as another report discovered that investors have been gradually exiting gold.

Despite the declines in Asian and European stock markets and uncertainty surrounding the upcoming informal Organization of the Petroleum Exporting Countries (OPEC) meeting, gold was unable to make any significant gains. This is because of the US presidential election debate that is being held at 01:00 GMT. Traders are waiting for clues to determine who has a better chance of winning the November election: Donald Trump or Hillary Clinton.

According to the latest polls, Republican nominee Trump is in a virtual tie with Democratic nominee Clinton. This makes the election results even more uncertain, which is good for the yellow metal.

Overall, gold has benefited from an array of issues in 2016, including Brexit, sluggish economic growth, accommodative monetary policy, volatility in global financial markets, and political strife.

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