#metals #gold #palladium
$GLD $PLA $USD
“Gold held onto gains and headed for its 1st weekly gainer since early June as investors weighed renewed concerns over economic growth” –Paul Ebeling
Bullion’s reversal comes with more economic data fueling fears of a recession. US business activity contracted in July for the 1st time in more than 2 yrs, according to data released Friday, adding to a lots of indicators earlier in the wk that are painting a gloomy outlook.
Meanwhile, a gauge of the greenback has retreated from its July 14 peak. “We are finally starting to see some weakness in the US dollar index, as gold bounces off an oversold level, recovering above $1,700 for now,” said the business development manager at Sydney-based bullion dealer Guardian Gold Australia. “We now expect this initial flight to the US dollar to start rotating back into gold as investors search for a true and reliable hedge against inflation.”
Also weighing on gold is ongoing selling by exchange-traded fund investors, Commerzbank AG analyst said in a note. Investors have withdrawn more than 100 tonnes from gold ETFs during the past 4 wks. “ETFs recently saw outflows on 17 consecutive days,” he said.
Palladium lead gains at 7%. Palladium is becoming the go-to commodity trade after strong earnings from Tesla and as Chinese consumers resume car purchases. If dollar weakness continues, palladium will be one of the commodities that benefit during this global economic growth downturn, according to the senior market analyst at Oanda. “Palladium will benefit as recession fears for the US should put a cap on the dollar rally and demand for cars should still remain strong across US and China,” he said. “I think some traders viewed today’s first half of China auto sales as very positive for palladium.”
Have a prosperous week, Keep the Faith!
