Gold braces for labor market week as investors eye manufacturing, jobs data
(Kitco News) – Gold and silver head into the new week with investors focused squarely on the health of the U.S. economy and labor market, as a busy calendar of economic data releases could significantly influence expectations for Federal Reserve policy.Bullion prices were supported this week by ongoing uncertainty surrounding economic growth and the path of interest rates. Gold continued to benefit from safe-haven demand and central bank buying trends, while silver traded with a mix of monetary and industrial influences, responding both to precious-metals sentiment and expectations for economic activity.The coming week’s data will offer a comprehensive snapshot of the U.S. economy, from manufacturing and services activity to labor market conditions. For precious metals investors, the reports will be closely scrutinized for signals on whether economic growth is slowing enough to prompt a more dovish tilt from the Federal Reserve.The week begins Monday with the ISM Manufacturing PMI, a closely watched gauge of factory activity. Manufacturing has spent much of the past two years struggling under the weight of high interest rates and uneven global demand. Analysts will be looking for signs that activity is either stabilizing or slipping further into contraction territory.On Tuesday, investors will turn their attention to the JOLTs Job Openings report, one of the Federal Reserve’s preferred measures of labor market tightness. Policymakers have repeatedly cited job openings as an important indicator of whether labor demand For gold traders, a softer JOLTs report could support prices by suggesting that labor market conditions are easing, potentially allowing the Fed greater flexibility to cut rates in the future.Wednesday brings the ADP Employment Change report and the ISM Services PMI.The ADP report serves as an early preview of private-sector hiring ahead of Friday’s official payrolls data. While the ADP figures do not always accurately predict the government’s employment report, markets often react strongly to a significant delineation from expectations.The ISM Services PMI may prove even more influential. The services sector accounts for the vast majority of U.S. economic activity and has been a critical source of economic resilience.Thursday’s focus will be on weekly jobless claims, one of the timeliest indicators of labor market health. Claims have remained historically low despite concerns about slower growth, leading many economists to characterize the labor market as remarkably resilient. The week’s most anticipated event arrives Friday with the release of Non-Farm Payrolls. The employment report will provide a comprehensive assessment of hiring, unemployment, and wage growth, all of which are critical inputs for Federal Reserve decision-making.Economists remain divided on the outlook. Some analysts believe hiring will continue to moderate as higher borrowing costs work their way through the economy, while others argue that labor demand remains strong enough to sustain healthy job growth.Federal Reserve officials have repeatedly stressed that future policy decisions will depend on incoming labor market and inflation data. A weaker payrolls report could boost gold by increasing expectations for lower interest rates, while a stronger-than-expected report could pressure bullion through higher Treasury yields and a stronger U.S. dollar.With virtually every major release next week carrying implications for monetary policy, traders should prepare for heightened volatility across precious metals markets as markets react to fresh evidence on the trajectory of the U.S. economy. Economic data to watch next week: Monday: ISM Manufacturing PMI Tuesday: JOLTs Job Openings Wednesday: ADP Employment Change, ISM Services PMIThursday: Weekly jobless claimsFriday: Non Farm Payrolls
Wall Street flips firmly bullish after gold’s late-week recovery, Main Street sentiment sours with jobs data on deck
(Kitco News) – Gold prices saw another choppy week, as safe-haven demand from renewed Middle East tensions was repeatedly offset by a stronger U.S. dollar, elevated Treasury yields, and fresh inflation concerns tied to the U.S.-Iran conflict.Spot gold kicked off the week trading at $4,508.30 per ounce on Sunday evening and quickly pushed higher as traders reacted to lingering geopolitical uncertainty, eventually testing resistance near $4,580. The rally held through Monday but began to fade Tuesday, with gold unable to extend the move as the dollar firmed and markets looked ahead to the week’s key U.S. inflation data.The selling accelerated through midweek after renewed U.S. strikes on Iran drove oil prices higher, raised fresh inflation fears, and undermined hopes for a durable ceasefire. Gold broke below $4,500 on Wednesday, then plunged again on Thursday as traders braced for the April PCE inflation report and revised first-quarter GDP data. Spot gold ultimately set its weekly low at $4,365.85 per ounce just after midnight on Thursday.The metal began to recover late Thursday and extended its rebound Friday after reports of progress toward a potential U.S.-Iran deal helped cool oil prices and ease some of the week’s inflation concerns. Softer Treasury yields also supported the move, allowing gold to surge to its weekly high of $4,594.92 per ounce on Friday before the rally lost momentum, with spot gold closing the week at $4,539.03 per ounce.The latest Kitco News Weekly Gold Survey showed Wall Street feeling fresh optimism about gold’s near-term prospects, while Main Street sentiment slid into bearish territory despite gold’s late-week rebound.“Gold recovered Thursday, alongside risk assets, amid the hopes of an extended ceasefire in the Middle East,” noted Marc Chandler, managing director at Bannockburn Global Forex. “The yellow metal had been sold through the 200-day moving average earlier the session for the first time in two years. It recovered and continued to do so ahead of the weekend, when it reached a three day high a little above $4543.”“An extended ceasefire is understood to be positive for gold because it removes a potential source of liquidation—oil exporters, and the need for liquidity by some oil importers,” Chandler said. “A move above the $4585 area would lift the technical tone.”“Up,” said Rich Checkan, president and COO of Asset Strategies International. “Assuming that the rumors of an impending ceasefire agreement between the U.S. and Iran are true, gold should rise as a result. This is the pattern we have seen since February. War leads to higher oil prices, higher inflation, and potential interest rate increases. Peace will supposedly take everything in the opposite direction.”Naeem Aslam, chief investment officer at Zaye Capital Markets, sees gold holding a strong but sensitive position.“Markets are balancing two competing signals: lower geopolitical stress around the Iran conflict and still-elevated inflation pressure,” he said. “White House comments pointing to resilient 2.6% GDP growth over the past four quarters, a 3.8% Atlanta Fed current-quarter growth estimate, oil prices down about 10% in May, and expectations that oil and gas prices will fall quickly after the conflict reduce part of gold’s emergency safe-haven premium.”“The geopolitical channel still supports gold because the same comments confirm that Iran negotiations remain tied to clear red lines, enriched uranium, and Strait of Hormuz security,” Aslam wrote. “That means gold is not trading only on inflation; it is also reacting to shipping routes, energy risk, dollar confidence, and safe-haven positioning.”He added that yesterday’s U.S. indicators kept the sentiment mixed but supportive, saying the data “supports gold’s floor because inflation remains above target and labour data is cooling, but it limits aggressive upside because monthly inflation momentum softened.”David Morrison, senior market analyst at Trade Nation, noted that gold went on quite a journey yesterday.“Early in the session it sliced through support at $4,400 to hit a four-week low under $4,370,” he said. “At that stage it looked as if that break of support would encourage further selling. But gold managed a tentative recovery, possibly helped by a modest pullback in the US dollar. This helped it to push back above $4,400 and from there it just soared.”Morrison said that the potential for a breakthrough in US-Iran negotiations also helped support the price of gold. “This move was also reinforced by US data which reduced the probability of a US rate hike this year,” he said. “Investors must now position themselves ahead of the weekend, unsure if developments will be positive or negative. But either way, gold’s rebound after breaking key support so easily must give some encouragement to the bulls.”Bob Haberkorn, senior market strategist at StoneX, told Kitco News that he’s still of the opinion that we have a lot higher to go in gold, and the clarity the market craves is coming soon.“I’m still very bullish on it,” he said. “There was a concern out there that central banks needed liquidity and they were selling gold, Turkey being one, and then news of Russia selling some gold here last week. I think for right [00:01:00] now, gold and silver are going to remain sideways to lower for the time being. But it’s bullish how supported they are; they’re trading down here to certain levels, but they’re holding above those levels.Haberkorn said the key date to watch, for gold and for the broader market, is June 17.“I want to see what comes out from the first Fed meeting with Warsh, to see what kind of tone he is going to take,” he said. “Are they looking dovish or hawkish with rates? Historically, in an environment like we’re in, rates should go up because of the need to combat inflation,” he said. “But we’re not in a position to, when the largest expenditure on the budget line right now is servicing that debt. To raise rates would put a significant strain on everything, and while it might help in the short term with combating inflation, I think long-term it could do more damage.”“I’m wondering if Warsh is going to tiptoe around, and say as much,” he said. “I don’t think he would say it in those exact words. He is Trump’s pick, and last week Trump was talking in a speech, I don’t remember where it was or what day it was on, but he was talking about r-rates and rates going much lower than where they’re currently at. Warsh is one vote on that board, but there’s going to be a reluctance here to raise rates given the debt situation and maybe they take an approach to grow out of it via some type of QE.“On the 17th, we’ll get more information to see where he’s at, and where the Fed is at with the new chairman.”Haberkorn said it’s extremely difficult to trade with any conviction in a market that’s so headline-driven. “You have headlines after headlines that contradict each other,” he said. “One minute, there’s a deal reached. Thirty minutes later, no, we haven’t signed anything yet. And then an hour later, you get something that contradicts that.”Haberkorn is looking to the Fed to clarify the situation for the market, and he hopes an Iran resolution will come about before then as well.“It feels like it’s getting to the point where we might get closer to a deal here,” he said. “Hopefully they do get to a deal, and we can put this in the rearview mirror for metal traders and focus on where the Fed’s going to be at.”“The Fed will set the tone for gold in the second half of the year.”“The biggest key to trading in precious metals right now is patience,” Haberkorn added. “Patience ahead of the Fed to see more where they’re at. I’m patiently optimistic that we’re going to see higher metal prices here into the second half of the year.”This week, 12 analysts participated in the Kitco News Gold Survey, with Wall Street sentiment shifting strongly back into bullish territory after gold bounced off key support levels. Nine experts, or 75%, expected to see gold prices gain ground during the week ahead, while two others, or 17% of the total, predicted a price decline. The remaining analyst, representing 8%, expected consolidation during the week ahead.Meanwhile, 39 votes were cast in Kitco’s online poll, with Main Street investors finally relinquishing their bullish majority despite gold’s resilience. 17 retail traders, or 44%, looked for gold prices to rise next week, while another 10, or 26%, predicted the yellow metal would lose ground. The remaining 12 investors, representing 31% of the total, expected gold prices to trend sideways in the coming week.Gold and silver head into the new week with investors focused squarely on the health of the U.S. economy and labor market, as a busy calendar of economic data releases could significantly influence Fed rate expectations.Monday morning will see the release of the ISM Manufacturing PMI, with analysts looking for signs that activity is either stabilizing or slipping further into contraction territory.On Tuesday, investors will turn their attention to the JOLTs Job Openings report, one of the Federal Reserve’s preferred measures of labor market tightness.Wednesday morning brings the ADP Employment report, which serves as an early preview of private-sector hiring ahead of Friday’s official payrolls data, followed by the ISM Services PMI.Thursday will see the release of weekly jobless claims, which have remained historically low despite concerns about slower growth, leading many economists to characterize the labor market as remarkably resilient. But the week’s preeminent focus is the Friday morning release of Non-Farm Payrolls, which will deliver the most comprehensive assessment of hiring, unemployment, and wage growth, all of which are critical inputs for Federal Reserve decision-making.Adam Button, head of currency strategy at Forexlive.com, told Kitco News that the world’s most closely watched commodities are sending conflicting signals.“The reality is that oil is pricing in an end to the war, and gold isn’t,” he said. “I think we just need to wait for the war to end. Simple as that.”Button said markets are beginning to realize that new Fed chair Kevin Warsh is starting out behind the curve. “The Fed can’t even get to neutral, and that’s what the dissents were about,” he said. “If the central bank is on top of inflation, you’ll see a lid on gold. When the market realizes the central bank is behind the curve on inflation, and that inflation could become disorderly, that will be bullish for gold.”Button said that gold has also suffered because the market’s AI excitement is soaking up all the liquidity.“There’s a certain portion of market participants who chase momentum, and maybe more than ever before, and they chased gold to a record high,” he said. “These are low-attention-span investors who are going to hop onto the next big thing, and they’re piling into AI now the way that they piled into gold and silver a few months ago.”“When it stops, gold will again start to soak up some of that liquidity, and then the cycle repeats.”Button said that gold prices have shown a firm floor multiple times since the Iran war began, and traders are just waiting for peace to break out for the yellow metal to resume its uptrend.“Everyone is just floating around on the surfboard waiting for the next wave,” he said. “They’re not leaving the beach.”And Button believes that wave is on the horizon.“At the risk of sounding stupid, I think the war is wrapping up, and that’s a catalyst for gold,” he said. “Fool me ten times, shame on me, but I think this is the time. But by the same measure, I don’t think there’s a rush to buy gold until you’re sure it’s a real peace headline. Wait for peace and buy gold when it happens.”“The [200-day moving average] would be a great place for it to happen,” Button added. “I think that would add a stronger bounce if it comes ahead of that, you’d get the fundamental and the technical backdrop.”Lukman Otunuga, senior manager of market analysis at FXTM, said the provisional Iran-US ceasefire extension has provided global markets with a measure of relief, even though Trump hasn’t signed it. “Yet ‘safe-haven’ gold continues to edge higher along with equities despite the positive mood.”“This dynamic continues to highlight how gold remains primarily influenced by the dollar and interest rate expectations,” he wrote. “Considering how Brent is heading for its biggest monthly drop since 2020, further weakness in oil markets may cool inflation fears. If this translates to a weaker dollar, gold may receive another tailwind in the week ahead.”Otunuga said the May jobs report should provide critical insight into the health of the labor market. “A weak report could add fuel to gold’s upside, especially if this further shaves bets around higher US rates in 2026,” he noted. “Traders are currently pricing a 60% chance that the Fed hikes rates by the end of this year.”On the technical front, Otunuga pointed out that gold is pushing higher on the daily charts after rebounding from the $4450 level. A break above the 21-day SMA could signal a move toward the 50-day SMA at $4625,” he said. “Weakness below $4450 could see a decline toward the 200-day SMA at $4400.”Adam Turnquist, chief technical strategist at LPL Financial, said that while rising yields, fading rate cut expectations, and improving risk appetite have weighed on gold since March, the longer-term structural tailwinds remain in place.“Central bank demand stayed strong during the first quarter, increasing 17% quarter over quarter, while concerns surrounding the U.S. fiscal deficit, persistent inflation risks, ongoing geopolitical tensions, and broader dollar diversification trends tied to policy uncertainty continue to support the longer-term case for gold,” he said. “From a technical perspective, gold has corrected sharply after reaching a record high of $5,595 in January. Since then, prices have formed a series of lower highs and are now testing a key support area defined by the rising 200-day moving average (dma) and the longer-term uptrend that began following gold’s breakout to new highs in early 2024.”Turnquist said that while momentum indicators remain bearish, there are early signs that downside pressure may be easing. “The Percent Price Oscillator (PPO) remains below the zero line and in a sell signal, but the recent higher low in momentum relative to price action has created a positive divergence, suggesting seller enthusiasm may be starting to fade,” he wrote. “We continue to respect gold’s longer-term uptrend and are monitoring for confirmation that support is holding alongside a turn higher in momentum, which would suggest the corrective phase is nearing completion. A decisive break below trend support would increase the risk of a continuation lower, with $4,099 representing the next major downside support area.”Alex Kuptsikevich, senior market analyst at FxPro, expects gold prices to trend lower next week.“Gold fell below $4,400, reaching levels last seen during the prolonged March decline,” he said. “At its intraday low, the price dipped below the 200-day moving average. Buyers have repeatedly stepped in around this level over the past three years. The last week of May was no exception. Beyond purely technical factors, the precious metal was supported by positive signals from the US-Iran front and an encouraging equity market rally, which boosted risk appetite.”“The key difference between the current rally from $4,400 to levels above $4,500 and the one in March is that gold no longer appears heavily oversold, and market conditions appear much more balanced,” Kuptsikevich noted. “A break below this level could open the way to the $4,000–$4,100 range. However, if selling pressure intensifies, the decline could prove much deeper, down to $3,400.”“Although we find it hard to believe in the sustainability of the current rebound, it is still worth acknowledging that the market may get stuck near current levels, gathering strength after the downward momentum, which could take anywhere from a couple of days to a week,” he added. “An even more optimistic – and even less likely – scenario involves a bullish breakout above the 50-day moving average at $4,630, which would put an end to the recent months’ downtrend and restore a long-term bullish bias.”Analysts at CPM Group issued a Sell recommendation on Thursday afternoon, with an Initial Target Price of $4,375 between May 29 and June 12, and a Stop Loss at $4,610.“Gold prices dropped to test $4,400 [on Thursday], touching $4,395.60 before rebounding to $4,545,” they wrote. “Gold and the other major precious metals have been moving in an ultra-short-term downward trend, testing short term support levels. A break below $4,400 could trigger a wave of selling taking gold to $4,100, which some technical analysts are citing.”“The June Comex futures contract has largely rolled into August, with only around 6.1 million ounces of open interest remaining in the June contract,” the analysts noted. “This also is taking some upward pressures off of prices at present, opening the door for another leg down in prices.“Some investor ardor has cooled. Economic conditions do not appear as dire as they did a couple of months ago,” they added. “While both domestic and international political conditions remain perilous, they seem to have entered a temporarily quiet period. These calmer exogenous trends have caused some investor profit-taking and reduced buying pressures, at least on a short term basis.”“Any of these factors can turn worse quickly, which would be expected to revive investor gold buying and push prices higher,” CPM warned, “but for now gold appears to be consolidating.”Michael Moor, founder of Moor Analytics, expects to see gold prices rise higher next week.“HIGHER, unless we take out lower timeframe formation mentioned below,” he wrote. “In a Higher time frame: I cautioned on 8/16/18 the break above $1,183.0 warned of renewed strength. We have seen $4,443.1. This is ON HOLD. We held exhaustion at 56192 with a 56268 high and rolled over $1,526.8. This is ON HOLD. On a medium timeframe basis: The trade below 52554 (+15 tics per/hour) projects this down $220 minimum, $740 (+) maximum—we attained $1,155.4. The trade back below 52036 (+13 per/hour) has brought in $1,103.6 of pressure. The trade back below 51606 (+13 per/hour) has brought in $1,060.6 of pressure. The trade below 48530 (+4 tics per/hour) has brought in $753.0 of pressure. These are ON HOLD. We held exhaustion at 40956 with a 41000 low and have rallied $817.7. The trade above 41814 has brought in $736.3 of strength. The trade above 43642 has brought in $553.5 of strength. These are OFF HOLD.”“On a lower timeframe basis: We held exhaustion with a 49177 high and rolled over $554.2,” Moor said. “The break below 48185 projected this down $185 (+)—we attained $455.0. The trade below 47923 projected this down $205 (+)—we attained $428.8. The break below 47420 brought in $378.5 of pressure. On 5/15 we left a medium bearish reversal—we have come off $189.7 from the 45532 open. The break below 45550 brought in $191.5 of pressure. These are ON HOLD. The break back above 44189 (-11.7 tics per/hour) has brought in $117.1 of strength. The trade above 45057 (-4.5 tics per/hour) now warns of decent strength. A maintained gap higher will leave a minor bullish reversal below.”At the time of writing, spot gold last traded at $4,540.53 per ounce for a loss of 0.22% on the week and a gain of 0.99% on the day.
Gold rebounds as weak GDP offsets Hormuz risk
(Kitco NewsWire) – Spot gold and silver prices are higher late Thursday, as weaker U.S. growth data and a softer dollar offset inflation pressure tied to the Strait of Hormuz and U.S.-Iran headlines. At the time of writing, spot gold was trading near $4,495.00 an ounce, up 0.89% on the session, while spot silver was trading at $75.530, up 1.35%.U.S. first-quarter GDP was revised down to a 1.6% annualized growth rate from the earlier 2.0% estimate, while April PCE inflation rose 0.4% month-on-month and 3.8% year-on-year. Core PCE rose 0.2% on the month and 3.3% from a year earlier. The softer growth revision and cooler core monthly reading helped gold rebound from its session low, even as the annual inflation rate remained well above the Federal Reserve’s 2% target.The data mix left traders pricing a narrower path for easier policy, with the 10-year Treasury yield near 4.48% and the dollar index off 0.1% near 99.16 in the immediate data reaction.The Strait of Hormuz remains the market’s main geopolitical pressure point: a narrow Gulf chokepoint where tanker traffic, crude exports and inflation expectations are being repriced against the possibility of a broader U.S.-Iran settlement. A tentative 60-day framework under discussion would extend the ceasefire, reopen shipping lanes without tolls and restart nuclear talks, but approval is not final and skirmishes around the waterway in the past 48 hours kept risk premium in oil, gold and rates. The perceived market impact was two-sided: lower oil on deal hopes reduced some inflation fear and supported gold through lower yields and a softer dollar, while any fresh military exchange would likely lift crude, inflation expectations and the dollar, a mix that has recently weighed on non-yielding metals.The key outside markets see Nymex WTI crude oil prices modestly firmer and settling around $88.90 a barrel, while Brent crude was near $92.72. The U.S. dollar index is lower. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.5% area.U.S. equities were mixed around the data, with early pressure in the S&P 500 and Nasdaq giving way to a more constructive tone as traders focused on weaker growth and less aggressive monthly core inflation. Gold futures rose 1.14% to $4,499.30, their largest one-day gain since May 6, while silver rose 1.36% to $75.645.Technically, spot gold bulls’ next upside price objective is to push prices back above the $4,589.00 to $4,631.00 resistance zone, with a sustained move targeting $4,774.00 and then $4,804.00. Bears’ next near-term downside price objective is a break below $4,366.00, with deeper downside targets at $4,099.12 and then $4,000.00. First resistance is seen at $4,589.00 and then at $4,631.00. First support is seen at $4,401.00 and then at $4,366.00.Spot silver bulls’ next upside price objective is to drive prices back above the $76.14 to $78.00 area, with a move above that zone targeting $79.00 and then $85.00. The next downside price objective for the bears is a break below $74.97, with deeper downside targets at $72.78 and then $71.79. First resistance is seen at $76.14 and then at $78.00. Next support is seen at $74.97 and then at $72.78.
Silver lags as gold defends $4,514 support
(Kitco NewsWire) – Spot gold prices are higher and spot silver prices are slightly lower in early U.S. trading Friday, as lower crude oil prices and easing Treasury yields supported bullion while silver remained capped below near-term moving-average resistance. At the time of writing, spot gold was trading near $4,528.90 an ounce, up 0.73%, while spot silver was trading near $75.475, down 0.24% on the session.Thursday’s April income and spending data kept the Federal Reserve pressure point intact. Personal income was essentially flat, disposable personal income fell 0.1%, personal consumption expenditures rose 0.5% and the saving rate fell to 2.6%. The PCE price index rose 0.4% on the month and 3.8% from a year earlier, while core PCE rose 0.2% on the month and 3.3% from a year earlier. Friday’s U.S. calendar brings preliminary April wholesale inventories at 8:30 a.m. ET and the May Chicago PMI at 9:45 a.m. ET.The Strait of Hormuz remains the main geopolitical transmission channel into energy, inflation expectations and precious metals, but Friday’s market is trading renewed deal optimism rather than escalation. Oil fell again after U.S. and Iranian negotiators reached a tentative framework to extend the ceasefire by 60 days and begin nuclear talks, pending President Donald Trump’s approval. Brent slipped toward $91.54 and WTI toward $87.64, down sharply from early-May levels, easing the energy-inflation impulse that had pushed yields higher earlier in the month. For gold, the current impact is mixed but supportive on balance: reduced conflict risk trims the safe-haven bid, while lower oil, lower yields and a softer inflation impulse improve the rate backdrop for non-yielding metals. Across other markets, the clearest effects are lower crude, firmer global equities, lower Treasury yields, a softer dollar tone and less pressure on rate-sensitive growth shares.Global equity tone was firmer before the U.S. open after Thursday’s record U.S. closes. The S&P 500 closed at 7,563.63, up 0.6%, the Nasdaq Composite rose 0.9% to 26,917.47, the Dow Jones Industrial Average edged up to 50,668.97 and the Russell 2000 gained 0.6% to 2,936.57. U.S. stock futures leaned higher Friday, helped by lower oil, cooler-than-expected core PCE momentum and stronger AI-related earnings, while global shares also benefited from the weaker oil-inflation channel.The key outside markets see Nymex WTI crude oil prices lower and trading around $87.64 a barrel, while Brent crude was near $91.54. The U.S. dollar index is softer. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.5% area.Technically, spot gold bulls’ next upside price objective is to push prices back above the $4,550 to $4,576 resistance zone, with a sustained move targeting $4,600 and then $4,660. Bears’ next near-term downside price objective is a break below $4,514, with deeper downside targets at $4,500 and then $4,460. First resistance is seen at $4,550 and then at $4,576. First support is seen at $4,514 and then at $4,500.Spot silver bulls’ next upside price objective is to drive prices back above the $76.00 to $76.50 area, with a move above that zone targeting $78.00 and then $78.92. The next downside price objective for the bears is a break below $74.97, with deeper downside targets at $74.26 and then $73.20. First resistance is seen at $76.00 and then at $76.50. Next support is seen at $74.97 and then at $74.26.
Gold price finding new support as U.S. New home sales drop 6.2% in April
(Kitco News) – The gold market is finding some bullish support following disappointing economic growth in the first quarter, and the precious metal could attract further bids after weaker-than-expected U.S. new home sales data.New home sales fell 6.2% in April to a seasonally adjusted annual rate of 622,000, down from March’s sales rate of 663,000, the U.S. Census Bureau and the U.S. Department of Housing and Urban Development announced Thursday.The decline was significantly larger than expected, as economists had forecast a relatively stable housing market with a sales rate of 661,000.On an annual basis, new home sales are down 11.3%.The gold market is not seeing much reaction to the disappointing housing data. Spot gold last traded at $4,459.90 an ounce, roughly unchanged on the day.The precious metal had already posted significant gains ahead of the North American market open.During the European session, gold prices hit a low of $4,366 an ounce, falling below their 200-day moving average.
Gold price bounces off its lows as U.S. economy grows 1.6% in Q1, core PCE rises 3.3%
(Kitco News) – The gold market has managed to bounce off its session lows but remains under significant selling pressure, even as the U.S. economy continues to cool and inflation pressures remain relatively muted — conditions analysts say could give the Federal Reserve room to cut interest rates by the end of the year.The Bureau of Economic Analysis announced the preliminary reading of first-quarter Gross Domestic Product on Thursday, saying the economy grew 1.6% quarter over quarter, down from the initial estimate of 2.0%. The data came in weaker than economists’ expectations, with consensus forecasts calling for growth to hold steady at 2.0%.“Real GDP was revised down 0.4 percentage point from the advance estimate, primarily reflecting downward revisions to investment and consumer spending,” the report said.“Within investment, the revision primarily reflected a downward revision to private nonfarm inventory investment, led by manufacturing and retail trade, based primarily on revised U.S. Census Bureau inventory book value data,” the report said. “The revision to consumer spending reflected a downward revision to services that was partly offset by an upward revision to goods. Within services, the largest contributor to the downward revision was health care (outpatient services as well as hospital and nursing home services), based primarily on U.S. Census Bureau Quarterly Services Survey data.”The weak economic activity appears to be cooling inflation pressures. In a separate report, the BEA said its core Personal Consumption Expenditures Index, which excludes volatile food and energy prices and is the Federal Reserve’s preferred inflation gauge, increased 0.2% last month, compared to a 0.3% increase in March.Economists had expected to see a 0.3% increase.For the year, core inflation rose 3.3%, in line with economists’ expectations. Some economists note that despite slower economic growth, inflation remains well above the central bank’s 2% target.The gold market is seeing some renewed buying momentum in its initial reaction to the latest economic data. Spot gold last traded at $4,409.10 an ounce, down 1% on the day.The precious metal suffered significant chart damage overnight as prices fell below initial support at $4,500 an ounce.
Metals drop as Iran deal hopes cut oil, haven bid
(Kitco NewsWire) – Spot gold and silver prices are sharply lower in early U.S. trading Wednesday, as lower oil prices, firmer global equities and reduced safe-haven demand outweighed support from lower Treasury yields. At the time of writing, spot gold was trading near $4,446.70 an ounce, down 1.35%, while spot silver was trading near $74.545, down 3.16% on the session.The U.S. calendar is light, with the Richmond Fed manufacturing index due at 10 a.m. ET. The heavier macro tape comes Thursday, when April personal income and spending, durable goods orders and second-estimate first-quarter GDP are due at 8:30 a.m. ET, followed by April new home sales at 10 a.m. ET. The Strait of Hormuz remains the main geopolitical transmission channel into energy, inflation expectations and precious metals, but Wednesday’s market is trading deal optimism more than escalation. Oil prices fell as U.S.-Iran negotiations were seen as still on track toward a possible peace agreement and reopening of the strait, even after recent U.S. strikes on Iranian boats and Iran’s retaliation against U.S. aircraft. Brent crude traded near $95 and WTI near $92, well below last week’s highs, easing inflation pressure and helping pull yields lower. For gold, the current impact is negative from the safe-haven side because a credible reopening path reduces the conflict premium, but supportive through lower oil and lower rate pressure. Across other markets, the clearest effects are lower crude, firmer equities, lower Treasury yields and reduced stress in energy-sensitive sectors.Global equities were mostly firmer before the U.S. open, tracking Tuesday’s record U.S. closes. Germany’s DAX rose 0.7%, France’s CAC 40 gained 0.5% and Britain’s FTSE 100 slipped 0.1%. S&P 500 futures edged up 0.1% and Dow futures gained 0.2%. In Asia, South Korea’s Kospi rose 2.3%, Taiwan’s Taiex gained 1.7%, Australia’s S&P/ASX 200 added 0.7%, Hong Kong’s Hang Seng lost 1.1% and China’s Shanghai Composite fell 1.3%.The key outside markets see Nymex WTI crude oil prices lower and trading around $91.92 a barrel, while Brent crude was near $95.03. The U.S. dollar index is firmer. The yield on the benchmark 10-year U.S. Treasury note is trading near the 4.5% area.Technically, spot gold bulls’ next upside price objective is to push prices back above the $4,453 to $4,484 resistance zone, with a sustained move targeting $4,523 and then $4,538. Bears’ next near-term downside price objective is a break below $4,424.40, with deeper downside targets at $4,404.90 and then $4,319. First resistance is seen at $4,453 and then at $4,484. First support is seen at $4,424.40 and then at $4,404.90.Spot silver bulls’ next upside price objective is to drive prices back above the $75.78 to $76.50 area, with a move above that zone targeting $77.00 and then $77.75. The next downside price objective for the bears is a break below $73.43, with deeper downside targets at $72.00 and then $70.00. First resistance is seen at $75.78 and then at $76.50. Next support is seen at $73.43 and then at $72.00.
UBS lowers 2026 gold price forecast to $5,500/oz: ‘Markets are rediscovering the concept of opportunity cost’
(Kitco News) – Swiss banking giant UBS has cut its year-end 2026 gold price forecast from $5,900 to $5,500 per ounce, citing risks of persistent headwinds from elevated Treasury yields and sustained U.S. dollar strength.UBS analysts Dominic Schnider and Wayne Gordon said that investors are shying away from the yellow metal as yields stay high.“Markets are rediscovering the concept of opportunity cost, with gold’s non-yielding characteristics once again becoming a more important consideration as real rates remain elevated,” they wrote in a note.Schnider and Gordon noted that both ETF and futures demand has softened significantly, and the recent stabilization in flows is not yet sufficient to restore the strong upward momentum gold enjoyed earlier in 2026.While UBS does not believe the structural gold bull market is over, the analysts said investors may require greater patience in the face of these challenges. Still, the analysts project gold will finish the year $1,000 higher than its current price.Looking ahead to 2027, Schnider and Gordon said that a more neutral monetary policy backdrop could weaken support for the dollar and improve investor appetite for gold once again.On April 13, UBS commodity analyst Giovanni Staunovo said that commodities such as gold and oil will likely continue to deliver outsized price gains long after the Iran war is over, and investors sitting on substantial gold positions should consider broadening their commodity exposure.In a research note, Staunovo analyzed the impact of the ongoing Middle East conflict on the commodity sector.“Continued tensions in Iran and risks in the Strait of Hormuz have added upside pressure to both prices and volatility in commodities, most notably oil,” he wrote. “We continue to see upside for commodities, driven by fundamentals and supply-demand imbalances alongside further geopolitical risks. Maintaining an allocation to commodities, with a focus on active management, can help investors hedge against inflation and energy supply shocks.”Staunovo noted that Brent crude was trading around $72 per barrel before the strikes on Iran, but was $102 per barrel at the time.“Gold prices are currently just under 13% below their all-time closing high in January, with higher rate expectations since the escalation of tensions weighing on sentiment,” he said. “Broad commodities have gained around 17% year to date, based on the UBS CMCI Composite total returns index in US dollars.”Staunovo said that even though the geopolitical risk premium is expected to fade, the fundamentals for commodities look supportive.“Oil product inventories are running low in various economies and could necessitate even higher prices to ration demand before stocks are refilled,” he said. “Over the medium term, we would still expect gold to rally substantially if geopolitical uncertainty remains high while interest rate expectations come down.”He added that UBS is projecting further supply shortages for copper and aluminum, supporting prices over the medium term even as structural drivers such as electrification underpin long-term demand.Staunovo noted that commodity returns “can be strong when supply-demand imbalances or macro risks, such as inflation or geopolitical events, are elevated.”“For investors with an affinity for gold, we believe a modest allocation can enhance diversification and buffer against systemic risks,” he said. “For investors with substantial allocations and significant unrealized profits in gold, broadening commodity exposure to include copper, aluminum, and agricultural assets can help diversify sources of future return, in our view.”On March 16, commodity analysts at UBS predicted that the updated calculus of risk, interest rate policy, inflation, and strong underlying demand will still propel the yellow metal as high as $6,200 per ounce by the end of 2026.The analysts noted that gold has been unable to break out above $5,200 per ounce since the start of the Iran conflict, with its supposed safe-haven bid failing to materialize. “This creates a contrast to its 65% rise last year, when heightened geopolitical risks served as a tailwind amid fundamental drivers such as lower real interest rates and debt concerns,” they noted. “Its latest performance mirrors historical behavior during such events, where investors seek liquidity and consider alternatives like energy assets.”“For instance, gold jumped 15% after the start of the Russia-Ukraine conflict in 2022, but then declined by 15-18% as the Federal Reserve raised rates,” they wrote. “The same happened during the Gulf War and Iraq War—prices rose 17% and 19%, respectively, at the start but decreased as tensions eased.”But the yellow metal’s recent sideways churn has not shaken the Swiss banking giant’s belief that gold will gain another 20% or more in 2026.“[W]e maintain the view that gold prices should rise toward USD 5,900-6,200/oz this year,” they said. “Gold is more of a hedge against the wider impact of conflicts, rather than direct wartime threats. Gold primarily insulates against monetary risks like currency devaluation, rising deficits, and economic slowdowns, which can result from geopolitical conflicts.”“In the short term, higher energy prices and inflation worries have led to a stronger US dollar and concerns over potential rate hikes—both are negative for gold prices,” the analysts conceded. “But we expect central banks to be watchful of inflation risks without making knee-jerk policy rate hikes.”In addition, the longer the U.S.-Iran conflict drags on, the greater the risk of negative economic impacts, which will likely support hedging demand for gold. “Over the longer term, gold stands out as a hedge against inflation,” they said. “According to the Global Investment Returns Yearbook, the real returns of gold and commodities since 1900 have positive correlations to inflation.”UBS also pointed out that underlying demand for gold remains strong. “While ETF investors trimmed their gold holdings slightly earlier this month, their positions have shown greater stability of late, and hedge funds have modestly boosted their net positioning in gold,” the analysts wrote. “We believe total gold demand is likely to stay strong, supported by continued central bank purchases, rising investment activity, as well as the structural growth of demand for gold jewelry amid higher incomes in Asia.”Structural trends will also continue to support gold’s appeal. “We expect structural trends such as elevated government debt as well as central banks’ and global investors’ efforts to diversify away from the greenback to support gold’s long-term outlook,” they added. “So, given the macroeconomic and political uncertainties beyond the risks arising from the US-Iran conflict, we continue to hold a positive view on gold and believe that the yellow metal remains an effective portfolio diversifier. Investors with an affinity for gold could consider an up to mid-single-digit allocation in a diversified portfolio.”
Gold prices testing support at $4,500 as U.S. consumer confidence falls slight to 93.1
(Kitco News) – The gold market continues to hold support above $4,500 an ounce but is struggling to attract new bullish momentum, even as U.S. consumer confidence continues to fall amid rising inflation pressures and growing recession risks.The Consumer Confidence Index dropped to 93.1 in May, compared to April’s reading of 93.8, the Conference Board announced on Tuesday. Although sentiment declined, the data slightly beat economists’ expectations. According to consensus estimates, the market had been expecting a drop to 91.9.”Consumer confidence edged downward in May as the inflationary impacts of the war in the Middle East intensified,” said Dana M. Peterson, Chief Economist at The Conference Board. “Consumer appraisals of current business conditions and the current labor market were moderately less positive compared to last month. This was somewhat offset by modest improvements in consumers’ expectations for business conditions and the labor market six months from now. Meanwhile, income expectations eased in May, as those anticipating lower income rose.”The gold market is seeing little reaction to the latest economic data. Spot gold last traded at $4,509.10 an ounce, down more than 1% on the day.The precious metal continues to react to the ongoing chaos in the Middle East, as the war in Iran drives oil prices higher and generates new inflation fears.
Malaysia follows India’s example with new 10% import duty on LBMA gold bars
(Kitco News) – After India’s recent hike of import duties on precious metals, another large Asian market has followed suit: Malaysia’s customs department has announced that they will now target gold bars with a new tax, marking the country’s first-ever import duty on bullion.The new policy creates a 10% customs tax on physical gold bars meeting London Bullion Market Association standards, and it takes effect on June 8, 2026, ending the country’s previous exemption on gold bullion import duties. The policy represents a sharp departure from Malaysia’s longstanding attitude toward the yellow metal, as the country had never levied any import or export duties on gold bullion or jewelry previously.The tax targets LBMA bars in particular, which are 99.99% pure gold and meet the international wholesale standard used by central banks, institutional investors, and major trading houses worldwide. These are the bars most commonly available through gold accounts offered by Malaysian banks.Based on initial reports, non-LBMA gold bars and all gold jewelry have remained untouched by the new import duties, effectively creating a two-tiered gold market in Malaysia where the most internationally recognized, highest-purity gold bars face a tax premium that lower-purity alternatives do not.Banks offering LBMA-standard gold bars will be forced to add the customs tax into their retail pricing, meaning the spread between Malaysian gold prices and international spot prices will widen considerably once the new import duties take effect.The Malaysian government’s move follows a similar and equally sudden change to import policies in the world’s second-largest gold and silver market, which have triggered a cascade of impacts across India’s metals and currency markets.“Recent domestic policy measures aimed at preserving national reserves and regulating precious metal inflows have sparked discussions among investors and market participants regarding their potential impact on local supply dynamics, price transmission, and exchange-traded fund (ETF) valuations,” wrote Mariya Paliwala, Senior Editor at Juris Hour. Paliwala said the most immediate impact of the policy announcement has been seen in domestic prices. “Despite the increase in import duties, market prices did not react proportionately in the initial phase,” she said, citing an industry source who noted that despite the net 9% increase in duties, prices only rose between 5% and 6% in the immediate wake of the announcement, which they attribute to “existing inventories purchased at earlier rates and available with comfortable margins” as well as “weak consumer willingness to absorb a sudden and sharp increase in prices.”However, as those existing lower-cost stocks dwindle, domestic gold and silver prices are expected to reflect the full brunt of the higher import duties.Other analysts are looking to broader changes in the global macroeconomic landscape – including the resolution of the Iran conflict – as the main catalyst to propel prices significantly higher over the medium term.“Beyond price movement, market experts are paying close attention to a different risk area — ETF premiums,” Paliwala said. “These premiums represent the additional amount investors pay above the underlying net asset value (NAV) of the assets held by the fund. Restrictions on silver imports have generated concerns that supply channels could tighten if demand rises sharply. Such circumstances may create distortions between physical availability and ETF pricing.”Modi cautioned that sudden investor enthusiasm or panic buying could widen ETF premiums beyond normal levels.Her industry source also warned that “silver could face relatively greater challenges than gold because supply restrictions are viewed as more significant for silver. If investor demand rises aggressively amid constrained supply conditions, ETF premiums may increase substantially.” If demand remains moderate, however, pressure on ETF pricing could remain under control.“Investors are now closely monitoring international developments to determine the future direction of prices,” she noted. “Key factors under observation include interest rate decisions by the US Federal Reserve under its new leadership, policy actions by major global central banks, fluctuations in the US dollar against the Indian rupee, and movements in Comex prices. Oil prices are also being watched carefully. While short-term increases in crude prices may influence inflation expectations and market sentiment, analysts note that historically elevated oil prices have often strengthened the appeal of gold as an inflation-hedging asset.”“Analysts believe that while policy changes may introduce temporary pricing distortions and market volatility, the broader investment case for precious metals continues to be supported by inflation concerns, monetary policy uncertainty, and global economic conditions,” Paliwala concluded.At the same time, innovative local solutions to the price and supply distortions are emerging. The India Bullion and Jewellers Association (IBJA) has now proposed the monetization of nearly 1,000 tons of idle ‘temple gold,’ which they say could “ease pressure on imports while protecting jobs in the small jeweller and artisan segment.””Gold is the second-largest contributor to foreign exchange outflow from the country,” said IBJA’s Gujarat State President Nainesh Pachchigar, with India importing around 800 tonnes of gold per year. The IBJA is proposing that this demand be served in part through domestic gold stocks held by trusts. “Many trusts currently hold large quantities of idle gold — nearly 1,000 tons in total,” he said. “If even a portion of that gold can be utilized, it would help significantly.”The IBJA said that “it is not seeking a permanent transfer of ownership to the government, but rather a structured monetisation mechanism that keeps the metal in circulation within the formal economy.”Pachchigar also issued a direct appeal to the country’s jewelers to stop bullion trading activities. “We appeal to all jewellers not to engage in bullion trading and not to sell bullion directly to customers,” he said. “We request jewellers not to sell bullion above five grams.” Pachchigar said the advisory was issued immediately after the duty hike to align with the government’s objective of curbing speculative demand.”We request that jewellery sales continue only to the extent genuinely required by customers,” Pachchigar said, explaining that jewelry sales for ceremonies and essential purposes can continue, but non-essential sales must be limited.He also highlighted the potential impact on employment in the jewelry sector. “Another important concern is employment, especially for small labourers and workers… whose livelihoods depend on the jewellery industry,” he said, adding that if the ‘temple gold’ monetization scheme and other mitigation proposals are adopted, “employment opportunities will also be protected.”Meanwhile, India’s weakening currency – the main problem the raised import duties were designed to address – hit a fresh all-time low on Thursday, which pushed domestic gold and silver prices higher.The Indian rupee hit a low of 96.923 per U.S. dollar on May 20 and spent several hours bumping up against the 97 level before regaining some of its losses over the following days.
