Daily Gold Update

Source:Matt Warden, American Gold Exchange

AustinGold has been consolidating since surging over $1,500 last week, ending the trading day 0.6% higher to close at $1,517.20, approaching on last week’s six-year high of $1,519.60. Gold is shining as a safe-haven amid growing global uncertainty over the U.S.-China trade war, slowing global and US economic growth, and mounting worries about China's response to ongoing Hong Kong demonstrations.

Demand for gold increased notably last week, according to U.S. Commodity Futures Trading Commission (CFTC) data published Friday, with hedge funds increasing their net-long gold position by 23%, the highest since July 2016. Additionally, holdings in global ETFs backed by gold are now at the highest since March 2013, with inflows for the month of July topping $2.6 billion, or 52 tons, an increase of 2%, according to the latest data from The World Gold Council.

Fears of slowing economic growth were noted over the weekend by Goldman Sachs, who warned the U.S.-China trade war is having a greater effect on the U.S. economy than expected and warned the risk of recession is rising. They now do not expect a trade deal before the 2020 presidential election and, if correct, predict a 0.6% drag on the US economy due to increased uncertainty and the expectation of 10% higher tariffs on an additional $300 billion in Chinese exports starting September 1.

Safe-haven demand was also buoyed by the escalating protest in Hong Kong. Chinese authorities condemned this weekend's ongoing Hong Kong protests as "the first signs of terrorism" and vowed a merciless crackdown on demonstrators. Protesters flooded the city's airport, forcing authorities to take the rare step of cancelling outgoing flights. In response to the unrest, the Chinese People's Armed Police have been assembling in a bordering Hong Kong city in advance of an apparent large-scale exercise, according to reporting from the Chinese-owned Global Times.

The other precious metals mostly outperformed gold today with silver and palladium both 0.8% higher, while platinum was essentially unchanged at 0.02% lower.

At the Comex close: December gold settled $8.70 higher at $1,517.20; September silver tacked on 14 cents to $17.07; October platinum slipped 20 cents to $863.70; and September palladium rose $11.50 to $1,430.80 an ounce.