MW-GX670_goldst_ZG_20181102071937.jpg

Metals Stocks: Gold extends gains scored after Fed’s Powell sends dovish signals on rates

This post was originally published on this site

Gold continued higher Thursday, building on gains scored a day earlier as remarks by Federal Reserve Chairman Jerome Powell were seen signaling a rate cut remains likely at the end of the month.

Gold for August delivery on Comex GCQ19, +0.69%  rose $9.10, or 0.6%, to $1,421.60 an ounce, while September silver SIU19, +0.42%  was up 7.4 cents, or 0.5%, at $15.30 an ounce.

Powell’s dovish tone sent the U.S. dollar lower and it remains weaker on Thursday. The ICE U.S. Dollar Index DXY, -0.30% a measure of the currency against a basket of six major rivals, fell 0.2% Thursday to 96.885 and is down 0.4% so far this week. A weaker dollar can be a positive to commodities priced in the greenback as it makes them less expensive to users of other currencies.

See: Fed’s Powell says trade worries restraining the economy, hints at interest-rate cuts soon

“Gold surged past the $1,400 mark thanks to the softer [U.S. dollar] as the inverse relationship between the two markets continues to be strong. Gold remains in its bullish trend, and it might look to retest the $1,439 region,” said David Madden, market analyst at CMC, in a note.

Powell will testify on Capitol Hill for a second day on Thursday, appearing before the Senate Banking Committee at 10 a.m. Eastern.

In other metals trade, October platinum PLV19, +0.16%  rose $2.30, or 0.3%, to $832.30 an ounce, wile September palladium PAU19, -0.79%  fell $7.50, or 0.5%, to $1,580.60 an ounce.

September copper HGU19, -0.04%  was off 0.6 cent, or 0.2%, at $2.688 a pound.