Market Nuggets
Standard Chartered: Central Banks Remain Net Buyers Of Gold
Central banks were net buyers of gold in February and are likely to remain so, says Standard Chartered. “Appetite to sell was limited, sensitivity to price volatility was muted, and purchases were dominated by a small number of consistent buyers of size who view gold as a key asset,” Standard says. Russia added 22.8 tonnes of gold to its official reserves, following purchases of 18.9 tonnes in January, and 224 tonnes last year, the 11th straight year of additions, Standard says. “Turkey also continues to add significantly to its reserves, buying 8.8 tonnes in February, following additions of 17.5 tonnes in January and 86 tonnes in 2017,” Standard says. “Turkey had previously added gold because it was accepted as a reserve requirement from commercial banks, but last year it started to add gold to its own balance sheet.” Meanwhile, Kazakhstan added 4.01 tonnes in February and has upped reserves each month since 2012, Standard points out. “We expect central banks to remain net buyers.”
By Allen Sykora of Kitco News; asykora@kitco.com
RBC's Gero: Dollar, Stock Weakness Draws ‘Asset Allocators’ Into Gold
Monday April 02, 2018 09:32
“Asset allocators” are interested in gold again due to a weaker U.S. dollar, says George Gero, managing director with RBC Wealth Management. Further, he cites some wariness of stocks and bonds, with “additional geopolitical headlines adding to concerns of investors, with headlines on escalating trade and tariff retaliations.” As of 9:11 a.m. EDT, Comex June gold was $11.20 higher to $1,338.50 an ounce.
By Allen Sykora of Kitco News; asykora@kitco.com
Analysts: Markets To Key On Wage Growth In U.S. Jobs Report
Monday April 02, 2018 09:32
The wage-growth portion of the monthly U.S. jobs report, which is due out on Friday, will be a key for markets, analysts report. Expectations are for March nonfarm payrolls to rise by somewhere between 167,000 and 190,000 after a 313,000 gain in February, while the unemployment rate is seen edging down to 4% from 4.1%. “However, wage growth remains to be the key market-moving piece, after showing an unexpected fall from [a yearly rate of] 2.8% to 2.6% last month,” says Hussein Sayed, chief market strategist at FXTM. “Given that one of the main arguments in markets today is whether the Fed will raise rates by another two or three times in 2018, this figure will play an important role in pricing interest rates expectations, and thus the dollar’s direction.” Brown Brothers Harriman also says that “the focus has shifted from job growth per se to hourly earnings,” although employment gains remain “robust.” The forecast is for a monthly wage rise of 0.3%, compared to a longer-term (12- and 24-month) average of 0.2%, BBH continues. “The base effect limits the impact on the year-over-year rate, but a 0.3% increase would be sufficient to lift the yearly pace to 2.7%,” BBH says. “The 12- and 24-month average is 2.6%.” If so, the data may suggest that the jobs market “remains strong but with no compelling evidence of earnings acceleration,” BBH adds.
