Gold, Silver Rise 2.5% and 3.2% As ‘Trump Trade’ Fades

Monday, March 27, 2017
By Paul Martin

Monday, 27 March 2017

Gold and silver jumped another 1% overnight in Asia, building on the respective 1.5% and 2.2% gains seen last week. The ‘Trump trade’ is fading, impacting stock markets and risk off has returned to global markets with the Nikkei, S&P 500 futures and European stocks weakening.

The precious metals had their second consecutive week of gains last week. Gold rose 1.5% and silver 2% while platinum rose 0.5% and palladium surged 4.8%. Today, gold has risen from $1,247.90 to a one month high of $1,259 per ounce and silver from $17.74 to $17.92 per ounce.

The precious metals continue to outperform most assets in 2017. Year to date, gold is 9% higher and silver is 11.7% higher. Platinum is 8.4% higher and palladium has surged 18% to two year highs.

Gold and silver have eked out gains as the dollar and stocks have come under pressure after U.S. President Donald Trump failed in his attempts to abolish Obama care. Trump suffered a major political setback on healthcare reform, raising doubts about his ability to steer the economic agenda.

The dollar has fallen to the lowest level in five months and stock markets globally are seeing sharp falls today. Trump’s inability to deliver on a major election campaign promise marked a big defeat for a Republican president whose own party controls Congress, and raised doubts whether he would be able to push through tax reforms and mega-spending packages.

Growing U.S. political uncertainty is creating concerns that a recent pick-up in global business and consumer sentiment, particularly in Asia, may be impacted.

Bullion coin and bar demand remains robust. US Mint data shows that strong demand for gold and silver coins continued last week.

Sales of gold coins were the highest since the week ended February 10 and silver coin sales were the highest since the week ending January 20.

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