Gold Prices Rise Amid Positive Economic Data and Dollar Weakness

Strategic Insights -

Gold futures rose on Monday as a string of positive economic news, including Friday's US payrolls numbers, gave investors confidence to move out of the US dollar and into perceived riskier assets like gold and stocks. The New York Mercantile Exchange's June gold futures contract rose $7.70, or 0.7%, to settle at $1,133.80 an ounce, while the Institute for Supply Management's index of non-manufacturing activity moved to 55.4, from 53 in February. The National Association of Realtors' index for pending sales of used homes also rose by 8.2% to 97.6, further boosting market sentiment.

Key Takeaways:

  • Gold futures rose by $7.70, or 0.7%, to settle at $1,133.80 an ounce on the Comex division of the New York Mercantile Exchange.
  • The Institute for Supply Management's index of non-manufacturing activity moved to 55.4, from 53 in February, indicating a positive trend in economic growth.
  • The National Association of Realtors' index for pending sales of used homes rose by 8.2% to 97.6, exceeding economists' expectations of a 0.5% decline.
  • The US dollar's weakness contributed to gold's rise, as it made the dollar-denominated metal less expensive for purchasers using other currencies.
  • Platinum and palladium prices also rose above key psychological levels amid the increased appetite for perceived riskier assets, with most-actively traded July platinum rising $34.20, or 2%, to settle at $1,709.80.
  • The auto industry's strong demand for platinum and palladium, driven by the 24% jump in US auto sales last week, contributed to the rise in prices for these metals.

Statistics:

  • Gold futures rose by 0.7% to settle at $1,133.80 an ounce.
  • The Institute for Supply Management's index of non-manufacturing activity moved to 55.4, from 53 in February.
  • The National Association of Realtors' index for pending sales of used homes rose by 8.2% to 97.6.
  • The US economy created 162,000 jobs in March, according to Friday's US payrolls numbers.
  • US auto sales jumped 24% to more than one million cars and light trucks last week.

Sources:

  • Dow Jones Commodities News via Comtex
  • Matt Whittaker, Dow Jones Newswires ( matt.whittaker@dowjones.com )
  • Institute for Supply Management
  • National Association of Realtors
  • New York Mercantile Exchange
  • Comtex
  • Dow Jones & Company, Inc.