Gold and silver trade higher
Gold and silver are trading higher on Monday morning due to soft Chinese economic data and weakness in markets. At 8:01 AM EST, the COMEX gold futures contract for June delivery was trading at $1,283.80 per ounce—a gain of 0.87%. Silver was trading at $17.35 per ounce—a rise of 1.3%.
Weak Chinese economic data
China’s economic data were released on May 14. The data included retail sales data, investment data, and industrial production data. All of the above three economic releases posted lower-than-expected readings. This increased the demand for the safe-haven assets like the gold. The inflation numbers and Chinese trade data released in the previous week also disappointed the Market. Weaker-than-expected economic data from China added doubts about China’s economic stability.
Market looks forward to the FOMC minutes
The Market is looking forward to the FOMC (Federal Open Market Committee) meeting minutes scheduled on May 18 to gauge the timing of the interest rate hike decision. In 2016, gold rose by 20% due to weakness in the US dollar. It also rose due to a decrease in the chances and number of interest rate hikes from the expectations at the beginning of the year. On May 17, the release of US economic data including the core consumer price index, the housing starts data, and the industrial production will give information about the strength of the US economy. There will also be speeches by FOMC members.
Last week, COMEX gold and silver fell 1.6% and 2.3%, respectively. Precious metal producers Barrick Gold (ABX), Newmont Mining (NEM), Royal Gold (RGLD), Harmony Gold Mining (HMY), and Silver Wheaton (SLW) fell 0.32%, 0.18%, 3.5%, 9.2%, and 1.5%, respectively. The SPDR Gold Trust ETF (GLD) closed 1.2% lower last week.