Gold moved moderately higher overnight in a more stable range of $1172 - $1179.80, largely fading movement in the US dollar. Gold dipped to its $1172 low early during Asian time, when the DX ticked up to 96.67.

The yellow metal climbed for the rest of the session and reached $1179.80 as the DX slipped to 96.30. The greenback was pressured by some strength in the yuan (6.89 – 6.865), the yen (111.05 – 110.35, safe haven flows), and the euro ($1.1365 - $1.1395, higher Eurozone inflation).

Global equities were mixed with the NIKKEI +0.35%, the SCI was off 1.34%, European shares were off from 0.2% to 0.4%, and S&P futures were -0.2%. Higher oil prices (WTI from $65.30 – $65.89) were supportive of equities.

US stocks opened weaker (S&P -7 to 2835), hurt by renewed concerns over the emerging market currency crisis with the Turkish lira (5.80 – 6.34), S.African rand (14.65 – 15.02), Mexican Peso (18.95 – 19.15), Russian rouble (66.70 – 67.60) all moving substantially lower.

The US 10-year bond yield slid to 2.846%, and the DX was tugged down under the overnight low to reach 96.21. Gold rose in response, and took out its overnight high to trade $1180.70.

US stocks turned higher by late morning, and reached unchanged by mid-day with the telecom, materials, and consumer staples sectors leading gainers. A continued push higher in oil (WTI to $66.30) was supportive of equities, as was a comment from Mexican Economy Minister Guajardo that a NAFTA agreement would hopefully be done in very few days.

The 10-year yield rose to 2.86%, and the DX stabilized around 96.25, with a modest recovery in emerging market currencies keeping the DX in check. Gold retreated, and slid to $1176.50.


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