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RBC’s Gero: Crude, Eurozone Data, North Korea Underpin Gold

Kitco News

Comex gold continues its recent march higher, rising with crude and a generally better economic outlook for the euro zone, says George Gero, managing director with RBC Wealth Management. The latter helps the euro, which in turn is supportive for gold due to the metal’s inverse relationship with the U.S. dollar. “Political worries and other technical factors are looking better for gold now, especially with North Korea still saber rattling,” Gero adds. Expectations for an interest-rate hike at the June meeting of the Federal Open Market Committee are largely factored into prices already, he adds. As of 9:38 a.m. EDT, Comex June gold was up $4.50 to $1,234.50 an ounce.

By Allen Sykora of Kitco News; asykora@kitco.com

 

INTL FCStone: Weaker Dollar Index Boosts Gold Prices

Tuesday May 16, 2017 9:53

Gold and other precious metals have been underpinned by weakness in the U.S. dollar, says INTL FCStone. As of 9:25 a.m. EDT, the June dollar was down 0.601 point to 98.200. Shortly after this, Comex June gold was up $4.60 to $1,234.60, while July silver gained 11.2 cents to $16.715. “The advance is attributable to the dollar index slipping to a six-month low earlier today,” INTL FCStone says. “The euro is particularly strong and now trading at just under $1.11. Confidence emanating from the recent French election continues to boost the currency, as have the results of a local German state election that have buoyed the political prospects of (Chancellor) Angela Merkel's party heading into the fall elections.”

By Allen Sykora of Kitco News; asykora@kitco.com

 

BBH: Euro Hits Highest Level Against Dollar Since U.S. Election

Tuesday May 16, 2017 9:53

U.S. dollar weakness that emerged at the end of last week, partly in response to disappointing U.S. economic data, has continued after news reports that U.S. President Donald Trump shared highly classified information with Russia, says Brown Brothers Harriman. “The dollar appeared to have been stabilizing yesterday in the North American session,” BBH says. “News that President Trump may have shared intelligence with Russia's foreign minister and U.S. ambassador not only heightened ongoing concerns about the administration's ties with Russia but also is seen by some as jeopardizing the administration’s aggressive legislative agenda….Although there was some attempt, of course, to play down the significance of what was shared with the Russians, the damage-control exercise by aides may be almost as revealing as an acknowledgment. Also, that the story apparently was leaked by U.S. intelligence officers suggests a key source of tension in the community. Asia seemed slow to respond to the developments, but in the afternoon, it began to sell the dollar. The euro is the chief beneficiary. It was bid to…the highest level since the U.S. election.” The single European currency climbed as high as $1.10900 from $1.09760 late Monday.

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