Gold Rallies to 10-Week High, Largest Monthly Gain Since February

Gold Prices Are Going Higher

Gold ended the trading day at $1,322 an ounce on the Comex division of the New York Stock Exchange on Monday, a 10-week high, 6.1% gain for the month of June, and 3% gain for Q2. This is gold’s largest monthly gain since February.

Kitco points out that technical buying, bargain buying, and the U.S. dollar hitting a multi-week low sparked buying interest, as well as a report released by the San Francisco Federal Reserve that was bullish on gold. Other negative economic news such as data showing that the U.S. economy contracted by 2.9% in Q1 – the highest drop since early 2009 – and a lack of change in EU inflation data contributed to the rise. 

Chris Gaffney, senior market strategist at EverBank Wealth Management, called geopolitical tensions the “wild card” for the market, mentioning Iraq, Ukraine, and North Korea in particular. He added, “Any flare up in these areas could quickly lead to another round of ‘safe haven’ buying in the precious metals.”

Nonfarm payroll data, an important U.S. jobs report, is set to be released on Thursday, and Kitco calls it “arguably the most important U.S. economic data of the month.” In addition, Thursday is the monthly monetary policy meeting of the European Central Bank. It will be a trading day to pay attention to.