Gold / Silver / Copper Prices View - March 25 - 29

March 24, 2019

New York (March 24)  This week precious metals traders will be monitoring safe haven inflows into gold amid fresh fears over the outlook for the global economy and after the bond market flashed a recessionary warning.

On Friday the spread between 3-month Treasury bills and 10-year note yields inverted for the first time since 2007 after U.S. manufacturing data missed estimates. This inversion of the yield curve is widely seen as a leading indicator of recession.

“You have to take it seriously that it is a signal for slowing growth or a potential recession in the next 12 to 18 months. This is what the Fed looks at closely,” said Sean Simko, head of global fixed income management at SEI Investments Co in Oaks, Pennsylvania.

Gold futures for April delivery settled up 0.47% at $1,313.40 on the Comex division of the New York Mercantile Exchange, for a third straight weekly gain.

"Price action in gold continues to lend strength to our view that expected data deterioration will help spark a gold rally as interest rates continue to fall in the context of a slowing global economy," analysts at TD Securities wrote in a note.

"Gold could not break above $1,320 on the upside and saw a correction. The current trading range seems to be between $1,305-$1,320," said Afshin Nabavi, senior vice president at MKS SA.

"With the geopolitical and the (uncertain) Brexit situation, we may still be heading higher."

Elsewhere in metals trading, silver settled at $15.438 a troy ounce late Friday but still ended the week with gains of around 0.8%, while copper ended at $2.848, off 2% for the day, for a weekly loss of 2.21%.

Chicago Fed head Charles Evans, Boston Fed President Eric Rosengren and Kansas City Fed President Esther George are among some of the Fed officials scheduled to speak this week.

The Fed kept interest rates on hold earlier this month and indicated that there would be no further rate hikes this year — after indicating in December that two could take place.

A U.S. trade delegation, headed by Trade Representative Robert Lighthizer and Treasury Secretary Steven Mnuchin is to travel to Beijing this week to meet with Chinese Vice-Premier Liu He for further talks aimed at resolving the trade conflict between the world’s two largest economies.

Friday’s deadline for the U.K. to exit the European Union has been pushed back by two weeks to April 12 to give British Prime Minister Theresa May more time to persuade lawmakers to accept the withdrawal deal she negotiated. If lawmakers refuse to approve the deal for a third time a number of options, including a no-deal Brexit, open up.

Ahead of the coming week, has compiled a list of significant events likely to affect the markets.

Monday, March 25

The Ifo Institute is to publish a report on German business climate.

Chicago Fed President Charles Evans, Philadelphia Fed President Patrick Harker and Federal Reserve Bank of Boston President Eric Rosengren are all set to deliver remarks.

Tuesday, March 26

The U.S. is to release data on building permits, housing starts and consumer confidence.

Chicago Fed President Charles Evans, Philadelphia Fed President Patrick Harker are to speak again, as is Federal Reserve Bank of San Francisco Mary Daly.

Wednesday, March 27

The Reserve Bank of New Zealand is to announce its benchmark interest rate and publish a rate statement, which outlines economic conditions and the factors affecting the monetary policy decision.

European Central Bank President Mario Draghi is to speak at an ECB event in Frankfurt.

Canada is to release data on the trade balance.

Bank of Kansas City President Esther George deliver comments at an event hosted by the Money Marketeers of New York University.

Thursday, March 28

New Zealand is to release data on business confidence.

The U.S. is to publish the final revision to fourth quarter growth as well as data on initial jobless claims and pending home sales.

Fed Vice Chair Richard Clarida, Fed Governor Randal Quarles, Fed Governor Michelle Bowman and St. Louis Fed President James Bullard are all due to speak.

Friday, March 29

Canada is to produce data on GDP and raw material price inflation.

The U.S. is to wrap up the week with reports on personal spending, the core PCE price index, business activity in the Chicago area and new home sales. Fed Governor Randal Quarles is also to speak.

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