Hello and welcome to our market week preview, where we take a look at the economic data, market news, and headlines likely to have the biggest impact on pricing and market momentum for gold, silver and platinum, as well as key correlated assets.
Gold Markets
Gold prices remain at a suppressed level on Monday after selling throughout the prior week. While the yellow metal has had a choppy trading pattern to begin the week, it has come within a relatively tight band between $4995 and $5025/oz in spot markets. The majority of inputs waiting against gold prices again tie back to the war in Iran as it stretches into another week. The US Dollar remains very strong, while crude oil prices continue to rise and threaten a sharper surge in the future. Ahead of Monday morning’s cash open in the US, the price of crude per barrel ran as high as $105, and despite another sell-off from the highs, prices this time have only dropped as far as $95. With investors seriously concerned about the inflationary impact of oil remaining so expensive (let alone consolidating higher), gold continues losing its appeal as a short- to mid-term investment as the case for the Federal Reserve to begin cutting rates again is weakened.
With so many potential critical inputs swirling around gold at the moment, it’s somewhat unexpected to see the chart trading within such a temperate range. This week in particular, it may be a result of traders and managers taking a hands-off pause ahead of Wednesday’s FOMC meeting, waiting to see just how gloomy the central bank’s rhetoric and projections (with the quarterly SEP due as well as a statement on policy in the near term) regarding the potential negative impacts of an ongoing war in Iran. This level of constraint during a whirlwind however, also suggests that we might see a sudden burst of volatility once the FOMC statement hits the wires, or during Chair Powell’s post-meeting presser.
Silver and Platinum Markets
Silver and platinum continue to trade with relative immunity to the downward pressure on gold prices. Silver has not been fully left out of the rout as investors pile into the Dollar ahead of any other safe haven, but spot prices do appear to have solid support at $80/oz as it currently trades on Monday. As usual, silver’s better buoyancy under current conditions is likely thanks to its practical value to many global supply chains.
Platinum, meanwhile, is once again outperforming its cousins. Despite sliding late last week as well, the grey metal is the singular asset of the three that has traded notably higher on Monday, gaining roughly +4% on the day to trade just above $2100/oz. Platinum has a similar industrial profile to silver, but looks to actually be profiting off silver prices still being perceived as too rich, may have manufacturing pipelines (like jewelry, specifically) that have the flexibility to use either material.
US Economic Data to Watch this Week
Wednesday, March 18 at 2pm ET // FOMC Interest Rate Decision
[No meaningful change to monetary policy rates expected.]
And that’s how the precious metals basket is performing to begin the week. As always, we wish you all the best of luck in your markets in the coming days, and we’ll look forward to seeing you all back here next week for another metals market preview.