BBH: U.S. Dollar Remains Strong In Wake Of FOMC
The U.S. dollar rally has resumed in the wake of last week’s meeting ofthe Federal Open Market Committee, says Brown Brothers Harriman. “U.S. rates are headedhigher, while event risk in the euro zone and the U.K. remain in place,” BBHsays. Analysts say the news flow this week is expected to be dollar-supportive. Consensusestimates call for the October U.S. Consumer Price Index on Wednesday to rise2.5% year-on-year, while the core rate excluding food and energy rises 2.2%.This would come on the heels of a larger-than-expected rise in the ProducerPrice Index reported last week. Then markets expect a Thursday report toshow U.S. retail sales rose 0.5% last month. Strong data should underpin U.S.Treasury yields, BBH says. “The Fed basically signaled lastweek that a December hike will be seen,” BBH says.
By Allen Sykoraof Kitco News; asykora@kitco.com
Commerzbank: Gold Pressured By Strong U.S.Dollar
Monday November 12, 2018 08:31
Gold has fallen to its lowest level in more than a month onstrength in the U.S. dollar, says Commerzbank. As of 8:14 a.m. EDT, spot metalwas down $4.15 to $1,205.20 an ounce, while the dollar index was up 0.476 pointto 97.210. “There is a risk of further technical selling if it [gold] dropsunder $1,200,” Commerzbank says. “Weighing on its price is the much firmer U.S.dollar, which has climbed on a trade-weighted basis to its highest level inmore than 16 months.”
By Allen Sykoraof Kitco News; asykora@kitco.com
SP Angel: Investors Not Fleeing Gold ETFsDespite Price Drop
Monday November 12, 2018 08:31
Exchange-traded-fund investors and hedge funds“are showing no signs of abandoning” gold, even as the precious metal givesback the October rally, says commodities brokerage SP Angel. “Holdings inexchange-traded funds backed by gold have risen for five straight weeks, thelongest stretch in more than a year,” SP Angel says. Holdings in SPDR GoldShares, the world’s largest such ETF, stood at 755.23 tonnes at the end of lastweek, after they had stood at 730.17 one month earlier.
By Allen Sykoraof Kitco News; asykora@kitco.com
MKS: Dollar Strength May Mean Gold FallsBelow Support
Monday November 12, 2018 08:31
Gold likely will not be able to holdsupport around $1,205-an-ounce level if the U.S. dollar keeps rising, says MKS(Switzerland) S.A. The metal declined starting in Asia-Pacific trade overnightafter falling below the 100-day moving average at the end of last week, MKSsays. “The post-FOMC bid tone to the dollar continues to put downwards pressureon the precious complex...,” MKS says. Analysts later add: “We are seeing amodest level of support broadly around $1,205; however, sustained greenbackstrength is likely to see this level make way for a test underneath $1,200,with downside targets extending to $1,195 and $1,180.”
By Allen SykoraFor Kitco News
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