(Kitco News) - Gold and silver prices are posting modest losses in early U.S. trading Thursday, as trader/investor risk appetite in the general marketplace has somewhat improved late this week. April gold was last down $13.70 at $5,084.40. March silver prices were down $1.125 at $82.79.
U.S.-China trade truce may be extended by as much as one year: report. President Trump and Chinese leader Xi Jinping could extend their trade truce by as much as a year when they meet in Beijing in April, the South China Morning Post reported Thursday and as reported by Bloomberg, citing several unidentified people familiar with the discussions. The summit is set to be anchored around short-term economic wins, including fresh Chinese purchase commitments, the Morning Post report said.
Trump mulls quitting USMCA trade deal as U.S. House votes to end duties on Canada imports. President Trump is privately considering exiting the North American trade pact, people familiar with the matter said and as reported by Bloomberg, “injecting further uncertainty about the deal’s future into pivotal renegotiations involving the U.S., Canada and Mexico. The US-Mexico-Canada Agreement is set for a mandatory review before a possible extension on July 1, “a process that was once expected to be routine but has transformed into a contentious negotiation, with Trump demanding additional trade concessions from Ottawa and Mexico City,” said Bloomberg. Meantime, the Republican-led U.S. House has passed legislation aimed at ending the Trump’s levies on Canadian imports. “Wednesday’s vote represents an increase in political pressure to change course on Trump’s signature economic policy just months before the midterm elections,” said Bloomberg. “The vote also signals a growing anxiety over the White House’s economic agenda before elections that are expected to focus heavily on affordability.” The U.S. Senate will now take up the measure.
Fed governor Miran: Fed can still cut rates despite strong U.S. jobs report. Federal Reserve Governor Stephen Miran said surprising strength in January’s U.S. jobs data doesn’t mean Fed policymakers should hold off on additional interest rate cuts. “Miran said planned supply-side reforms such as a reduction of business regulations, along with an expectation that housing inflation will slow, will clear the way for policymakers to continue lowering their benchmark rate. Miran has dissented at every policy meeting since joining the Fed’s board in September, favoring larger reductions than his colleagues were prepared to support,” said a Bloomberg report. There are “a variety of reasons why I want to see lower interest rates, and while (Wednesday’s) jobs data made me feel really good about the economy, I think the truth is that pushing out the supply side of the economy still allows for monetary policies to accommodate that,” he told Fox Business in an interview. Traders have pared the probability of a rate cut at the Fed’s June FOMC meeting — previously eyed as the most likely timing for the next reduction — to less than 50%.
China buys Venezuelan crude oil from U.S. China has bought some Venezuelan crude oil that was purchased earlier by the U.S., according to U.S. Energy Secretary Chris Wright. The U.S. had asserted control over Venezuela's crude industry after seizing former President Nicolás Maduro, and the country's "oil quarantine" is essentially over, Wright said. China's refiners were the biggest buyers of Venezuelan crude before the U.S. move, and some banks expect a revival in Venezuelan output over the medium term.
The key outside markets today see the U.S. dollar slightly up, with crude oil prices a bit weaker and trading around $64.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently around 4.167 percent.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, April gold futures bulls’ next upside price objective is to produce a close above solid resistance at $5,250.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at last week’s low of $4,670.00. First resistance is seen at this week’s high of $5,144.50 and then at $5,200.00. First support is seen at Wednesday’s low of $5,036.30 and then at $5,000.00. Wyckoff's Market Rating: 6.5.
March silver futures bulls see their next upside price objective is closing prices above solid technical resistance at last week’s high of $92.015. The next downside price objective for the bears is closing prices below solid support at the February low of $63.90. First resistance is seen at this week’s high of $86.12 and then at $87.50. Next support is seen at $80.00 and then at this week’s low of $78.10. Wyckoff's Market Rating: 5.5.
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