AGE Daily Gold Update

AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.

5/13/2019: Gold surges on rekindled trade war

Source: Bill Musgrave, American Gold Exchange

Austin — Gold surged 1.1% to close near $1,302, the highest level in nearly a month, as China's retaliation for US tariffs hammered equities and boosted safe-haven assets.

The trade war between the US and China resumed in earnest as China announced tariffs as high as 25% on $60 billion in US goods, effective June 1. The move came in reaction to the Trump Administration's imposition on Friday of 25% tariffs on $200 billion in Chinese imports, citing a lack of progress in trade talks.

US equity markets responded with their worst day of 2019, with the Dow falling more than 700 points before bouncing back to a 540-point loss of 2%. The tech-heavy Nasdaq was hit even harder, losing 2.9%.

The yuan quickly fell to a four-year low while the dollar traded sideways, lifted by the weak yuan but pressured by rallied in safe-haven currencies like the yen and Swiss franc.

US Treasurys rallied alongside gold on flights to safety, inverting the yield-curve as 10-year yields fell below 3-month yields. An inverted yield curve often presages a recession.

The other precious metals were lower, with silver dipping 0.1% while platinum and palladium, more directly tied to industry, fell 1.2 % and 2.5%, respectively.

At the Comex close: June gold jumped $14.40 to $1,301.80; July silver dipped a cent to $14.78; July platinum fell $10.70 to $854.90; and June palladium tumbled $33.90 to $1,316.80 an ounce.