Precious Metals and Mining Shares on November 3
All four precious metals saw a down day on November 3, 2017. Gold, silver, platinum, and palladium fell 0.7%, 1.8%, 0.63%, and 0.25%, respectively. The fall in these metals was mainly led by the revival in the US dollar on the same day. The US dollar, depicted by the DXY Currency Index, rose 0.27% on Friday.
The rise in the dollar is often negative for precious metals because they’re dollar-denominated assets. When the dollar’s price is higher, it becomes more expensive for investors from other countries to purchase the dollar. As a result, the demand for these dollar-based assets also falls. The following chart shows the movement in gold and the dollar during October.
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Funds and miners’ movement
The Asian share markets moved higher on Friday as investors welcomed the Republican plans for massive US tax cuts. Also, the appointment of Fed Chair Jerome Powell was critical in the dollar and precious metals’ movement. The Republicans unveiled the tax bill on Thursday that would cost $1.51 trillion.
The SPDR Gold Trust (GLD), the world’s largest gold-backed ETF, saw its holdings fall 0.42% to 846.04 tons on November 2.
Pan American Silver (PAAS), Barrick Gold (ABX), Cia De Minas Buenaventura (BVN), and Harmony Gold (HMY) were among the mining shares that fell on Friday. They fell 1.3%, 0.71%, 1%, and 2.2%, respectively.