Gold prices are lower and silver prices are steady in early U.S. trading Thursday following a deflationary report from China. April gold was down $10.40 at $2,041.30, while March silver was up $0.015 at $22.375.
China’s consumer price index fell 0.8% year-on-year in January, marking the fourth consecutive month of declines and the biggest contraction since 2009. Nigel Green, the CEO of deVere Group, highlighted the potential threat to China’s manufacturing and export sectors, which are crucial to the nation’s economic growth and favored by international investors.
Green emphasized that the deflationary trend in China could also have a significant impact on commodities and industries reliant on natural resources. He suggested that Beijing needs to take steps to reignite growth and restore confidence in light of the cumulative economic downturn in China.
Asian and European stock markets were mixed in overnight trading, and U.S. stock index futures were set to open modestly down after hitting record highs on Wednesday. The U.S. dollar index was firmer, and Nymex crude oil prices were slightly higher.
Looking ahead, gold futures bulls have the overall near-term technical advantage, targeting a close in April futures above solid resistance at $2,100.00. On the other hand, the silver bears have the overall near-term technical advantage as prices remain in a two-month-old downtrend on the daily bar chart.
As with any investment, personal financial needs and goals must be considered when deciding to invest in commodities or other financial instruments. It’s important to know that investing comes with risks. Always invest with caution and consult with a financial advisor before making any investment decisions.
