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Metals Fall on Friday, Silver Avoids Losses

December 20, 2019 at 21:20 by Vladimir Vyun

Metals, including copper, gold, platinum, and palladium, dropped during Friday’s trading session. Silver was an exception, logging decent gains.

One of the likely reasons for the metals’ poor performance was the strong US dollar. A stronger greenback makes it more expensive to buy commodities priced in the US currency, thus discouraging traders from purchasing them. The main reason for the dollar’s rally was the acceleration of the annual US economic growth to 2.1% in the third quarter of 2019 from 2.0% in the second quarter. Core PCE inflation, which the Federal Reserve watches closely, remained stable at 0.1%, while both personal income and spending rose in November. The consumer sentiment climbed this month according to the report from the University of Michigan.

The week started with markets being in a risk-on mode due to the news about a phase-one trade deal between the United States and China. That boosted copper while weighing on gold at the same time. But by now the optimism has started to evaporate, and traders became more cautious, waiting for new developments in the trade relations between the world’s two biggest economies. The threat of US President Donald Trump’s impeachment was also hurting the market sentiment, and that may bolster bullion in the future.

Futures for delivery of gold in February fell by $3.3 (0.22%) to $1,481.1 per troy ounce as of 21:02 GMT on COMEX today. At the same time, March silver climbed by $0.07 (0.38%) to $17.22 per ounce. Spot price for platinum sank by $23.27 (2.49%) to $911.31 per ounce, while palladium tanked as much as $91.08 (4.7%) to $1,847.1 per ounce. Copper for delivery in March dropped by $0.027 (0.96%) to $2.7995.

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