The price of gold and silver continued to experience weakness on Monday, July 23. This was in spite of trade worries that came out of G20 finance ministers and central bankers over the weekend. The spot price of gold was down over half a percentage point in early afternoon trading and is threatening lows not seen since early 2017. The spot price of silver has similarly struggled.
The iShares Gold Trust ETF (NYSE:IAU) was down 0.51% in early afternoon trading and had sunk to lows not seen since late 2017.
The fall in precious metals may come as a surprise following a news week that should have been more favourable for gold and silver.
U.S. President Donald Trump openly criticized Federal Reserve policy for its rate tightening since he entered office. This softened the U.S. dollar but failed to generate much momentum for gold or silver. Over the weekend President Trump also lobbed sharp rhetoric at Iran.
Trump launched into an all caps tirade on Twitter and said that the nation would "SUFFER CONSEQUENCES" if it threatened the United States.
Precious metals have failed to receive a bump in spite of rising geopolitical tensions and the pressure exerted on the Federal Reserve to take a dovish turn.
If gold threatens the $1,200 mark investors may want to think about diving in as the Trump administration mulls over auto tariffs. This could spark a new round of volatility that could be positive for gold and could give central bankers pause over their current tightening path.
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