GOLD PRICE

The ongoing trade war between the U.S. and China has been the topic of significant debate over the last several months. The spat has shown it has the potential to move markets, and in recent weeks flashes of optimism have been met with disappointment.

In January the Federal Reserve took a dovish outlook when they signaled for a pause in rate hikes. Since January’s meeting we have seen a mix between positive and negative economic data. Given the mixed data analyst expect that the Fed will be cautious moving forward. The fed is expected to revise its dot plot for 2019 from 1 to 2 hikes down to 1 hike, during the March meeting.

The National Association of Home Builders/Wells Fargo Housing Market Index points to a flat reading for homebuilder sentiment from February through March. The index came in at 62 vs 63 expected, although 62 is still a six-month high after a turbulent period in housing.

Gold markets have kicked the week off with some healthy trading in the Sunday/overnight sessions, offering yellow metal at $1306/oz. After a mild sell-off at the Sunday evening open, gold looked likely to stay pinned around the $1299.50-level through the Asian session until strong buying stepped-in during the start of trading in London, re-breaking into $1300 and setting gold prices where we see them now.

We end the week in gold markets in a stronger price environment than we began with on Monday, setting the stage for prices to make another move towards $1350/oz next week, should the FOMC meeting provide the right kind of push.

US Consumer confidence has reportedly rebounded in March according to the latest survey by the University of Michigan released on Friday. After a two-year low seen at the beginning of the year due to the government shutdown and other factors, sentiment has risen to 97.8 vs 95.3 expected.

A key index used to measure business conditions in New York fell to 3.7 in March, the lowest in almost two years. After months of decline, there was an uptick in February which saw a reading of 8.8, but the uptrend has not continued for the final month of Q1.

January’s new home sales report missed substantially coming in at a 6.9 percent decline vs .6 percent expected. This report continues the decline from the one-year high that we saw in November of 2018. Investment in homebuilding declined by .2 percent in 2018 marking the weakest performance since 2010.

The gold market is getting hit hard in action on Thursday following significant weakness in the overnight session. The primary drivers behind the selling include weak data out of China, a higher dollar index and some corrective trade after recent gains. An apparent stall in U.S./China trade talks is not doing the market any favors either.

More Americans filed for unemployment benefits last week than expected, but at 229,000, the final figure is not far off market expectations of 225,000. Initial jobless claims, a key measure of layoffs, have been settling into a relatively flat pace on average recently.

The cost of imports in February saw the biggest jump in 9 months, with the increase due entirely to the rising price of fuels like oil and natural gas. Other import prices remained relatively flat, pointing to tame inflation pressures.

Durable goods orders rose by 0.4% in January vs -0.4% decline expected according to a Commerce Department report released on Wednesday which was delayed by the government shutdown. US factories saw increased demand for manufactured goods – however, the increase was largely due to the volatile aircraft category.