Gold ekes out 1.3% gains for Q1 2019

PATIENCE has been the latest mantra for gold investors as the yellow metal has struggled to find momentum while the first quarter of 2019 comes to a close.

Gold prices are looking to close the week in negative territory, ending a three-week winning streak. Despite a strong rally at the start of the new year, for the quarter, the yellow metal is eking out a modest gain, up 1.3%. June gold futures last traded at $1,297.70 an ounce.

According to analysts, although the precious metal is supported by falling bond yields, it continues to struggle against resilient strength in equity markets and the U.S. dollar; however, some analysts continue to look past near-term U.S. dollar strength as threats to the economy continue to build.

Mike McGlone, senior commodity strategist at Bloomberg Intelligence, said that he expects weaker equity markets to signal an end to the dollar’s rally.

“We expect last year’s strong dollar performance to have marked a last gasp for the bull market, and for the greenback to remain near the bottom of 2019 performers, which is primarily supportive of metals,” he wrote in a report Friday.

In a recent interview with Kitco News, Axel Merk, president and chief investment officer of Merk Investments said that a lot of the recent price action in gold can be chalked up to quarter-end positioning. He added that longterm, the recent drop in 10-year bond yields remains gold supportive.—Kitco.