Gold Futures Finish Week Slightly Higher - Chinese Buyers Fail to Boost Coin Market
Gold futures ended Friday’s session in the red, but managed to post a small weekly gain, after two consecutive weeks of declines. While nothing major developed in the gold markets this week, it was the same wrangling back and forth about whether or not the Fed will move to increase interest rates by year end.
On Friday, the US dollar index rose 0.5%. Over the week it gained about 1.4%. Even though gold has held onto its inverse relationship with the dollar pretty tightly, recently, gold declined only 0.2% this week and over the week added 0.3%.
The big developments this week, as related to the gold market, were the release of the Fed’s September meeting minutes and further comments from Fed Chair Janet Yellen. The meeting minutes showed that there was a fair bit of wrangling over whether or not to hike interest rates, with Yellen pushing to maintain rates. Adding to her dovish stance, on Friday in a speech, Yellen said an easy interest rate stance “could have costs that exceed the benefits by increasing the risk of financial instability or undermining price stability.”
There was some hope that gold premiums would snap their recent losing streak this week, with the return of Chinese buyers to the market, following the last week’s holiday, adding more interest to the market, but that never materialized. American Gold Eagle premiums came in at $56.63 on Friday, down from $57.06 last Friday, American Buffalo premiums fell to $57.89 from $58.33 last week and Canadian Maple Leaf fell to $44.14 down from $44.38.