Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold rose 0.3% to close at $1,318.50 as renewed concerns about global growth and the US-China trade war undermined risk appetite and boosted demand for safe havens. The metal finished the week down 0.3% but remains nearly 3% higher for 2019.

US and global equities fell, with the Dow and Global Dow both losing 0.6%, as worries about growth and trade conflicts soured demand for risk assets. President Trump confirmed that he will not meet China's President Xi Jinping before the March 1 deadline for the current suspension of additional tariffs. While some headway has been made, Larry Kudlow told Fox News that a "pretty sizable distance" remains between the two nations.

Yesterday, the EU projected growth in the Eurozone of just 1.2% for 2019, down from 1.7%. Today, the Bank of England also cut its growth forecast to 1.2% for 2019, the lowest since the financial crisis of 2019. These growth forecasts assume Britain and the EU will reach a trade agreement before late March. A hard Brexit, with no agreement in place, would further reduce growth in both economies.

The dollar edged up less than 0.1% as forex traders opted away from the pound and euro. The buck closed the week up 1% for its first weekly rise in three weeks. Treasury yields fell on safe-haven inflows.

James Bullard of the St. Louis Fed said today that US interests are now "slightly restrictive" and GDP is growing "considerably slower" than forecast. Bullard's comments add to the growing belief that the Fed will cut rates sometime this year. Former Fed Chair Janet Yellen said earlier this week that a rate cut could be coming if slowing growth in China and Europe spills into the US.

Consistent hikes over the past two years have been a major cause of strength in the dollar, pressuring gold by making it more expensive overseas. Rate cuts would reverse that trend, weakening the dollar and likely boosting the gold price.

Deutsche Bank issued research today concluding that the combination of US-China trade wars, slowing growth in China's economy, and a hard Brexit could combine to create a global downturn as damaging as the 2009 financial crisis.

The other precious metals were higher for the day and mixed for the week. Silver gained 0.6% today but ended the week down 0.8%. Platinum added 0.7% but still lost 2.9% this week. Palladium rallied 1% for a 4.4% rise this week.

At the Comex close: April gold rose $4.30 to $1,318.50; March silver added a dime, to $15.81; April platinum picked up $5.20 to 802.50; and March palladium gained $13.10 to $1,371.20 an ounce, another record close.

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