Gold futures edged higher on Monday to mark a third straight session gain, with uncertainty ahead of President Donald Trump’s address to Congress Tuesday evening helping to boost the metal’s appeal as a haven investment.
Prices for the shiny yellow commodity logged their highest finish in more than 3½ months Monday after notching a fourth-straight weekly gain.
Gold for April delivery GCJ7, -0.51% edged up by 50 cents, or less than 0.05%, to settle at $1,258.80 an ounce—the highest finish for a most-active futures contract since Nov. 10, according to FactSet Data. Last week, the metal gained 1.6%.
Silver for March delivery SIH7, -0.57% ended at $18.417 an ounce, up 1.1 cent, or les than 0.1%, for the session after climbing 1.7% last week to mark a ninth week of advances in a row.
Haven demand has lifted gold to its highest prices since November amid growing concerns about geopolitics, while the Federal Reserve’s lack of commitment to lift benchmark interest rates also helped to support higher prices in the precious metals.
The week’s marquee event is likely to be Trump’s late Tuesday address to a joint session of Congress, while Fed chief Janet Yellen takes the microphone Friday.
Chintan Karnani, chief market analyst at Insignia Consultants in New Delhi, said “Trump and the Federal Reserve are on opposite paths.”
“Trump wants lower interest rates and a weaker U.S. dollar,” while the Fed wants to increase interest rates if economic data meet its target and the central bank “is not overtly bothered of the movement in the U.S. dollar,” said Karnani. These “opposite paths can result in more gains for the U.S. dollar.”
But on Monday, the ICE Dollar Index DXY, -0.07% was little-changed as gold futures settled. Commodities priced in dollars often trade inversely with the dollar, as moves in the U.S. unit can influence the attractiveness of those commodities to holders of other currencies.
The dollar softened Friday amid indications that Trump’s tax and other pro-business policy plans would be implemented at a slower-than-expected pace.
“Investors are edgy and they want more information what these new phenomenal tax plans are and this is impacting the sentiment. This ambiguity is driving the price of gold higher and we think that the path of least resistance is skewed towards the upside,” said Naeem Aslam, chief market analyst at Think Markets.
“What is very important is the upcoming Fed Beige book data and different speeches from the Fed,” Aslam said. “The difference in their views will drive the dollar, which will bring higher volatility for the gold price.”
Fed Beige Book data will be released Wednesday. On Monday, data on orders for durable goods showed a climb of 1.8% in January. Excluding orders for airplanes and autos, however, books fell 0.2%.
In other metals, copper HGH7, +0.22% for May delivery ended nearly flat at $2.698 a pound. Platinum PLJ7, -0.37% for April delivery rose $10.20, or 1%, to $1,038.90 an ounce. Palladium PAH7, +0.10% for June delivery rose $12.05, or 1.6% to $785 an ounce.
As for related ETFs, the exchange-traded fund SPDR Gold Trust GLD, +0.09% added less than 0.1%, while the iShares Silver ETF SLV, +0.58% was nearly unchanged. The VanEck Vectors Gold Miners ETF GDX, +0.04% fell 0.5%.
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