Editorial: Gold, copper reach new highs – by John Cumming (Northern Miner – September 13, 2017)

The sustained strength in most precious and base metals this year reached breakout levels in September, as a weakening U.S. dollar and renewed optimism over Chinese metal demand pushed metal and mineral prices to new highs.

At press time, the spot gold price had surged to an 11-month high of US$1,336.60 per oz., up US$47.90, or 3.7%, in the last 30 days, up 9% in the last two months and up 17% this calendar year. Gold briefly touched US$1,356.60 per oz. on Sept. 8, before pulling back over the next two days, and seeming endling a two-month run-up from the US$1,211 per oz. level on July 10.

While the U.S. has enjoyed soaring stock markets, a growing economy and falling unemployment levels since Donald Trump was sworn in as U.S. president, the U.S. dollar has steadily lost strength throughout 2017, and has seen an accelerated decline since July, which observers attribute to the U.S. Federal Reserve not raising interest rates and gridlock in Washington, D.C. — which derailed health care reform and threatens to scuttle planned tax cuts. The U.S. Dollar Index is down more than 10% this year to 91.861 at press time.

Gold’s role as a safe-haven asset has once again come into play, as the standoff between North Korea and the U.S. and its allies over North Korea’s nuclear missile program reaches new levels of tension, and the prospects of military confrontation become less far-fetched. Gold prices gained US$5 to US$10 per oz. after major North Korean missile and nuclear tests.

This September, gold analysts are arguing that the good news for gold has already been baked into the price, and point to US$1,360 per oz. as a new ceiling for the gold price for the rest of the year, even if U.S. Fed rate hikes are put off over and over again.

For the rest of this article: http://www.northernminer.com/news/editorial-gold-copper-reach-new-highs/1003789425/

Comments are closed.