30th March 2017

 We had a very quiet day in the markets, with the precious metals group finishing mostly mixed. In a way, investors are in something of a holding pattern, as a number of Fed governors have alluded to the fact this week that the Federal Reserve’s interest rate trajectory is going to remain intact, thus limiting the dollar’s decline and capping gold’s rally in the process as well. On the other hand, there remains lingering uncertainty about the upcoming French elections. Although the far right candidate, Marine Le Pen, lags establishment candidates by significant margins, there still is a large pool of undecided French voters that could sway the election. We think the far right will eventually flame out, but given the uncertainty in the polls, especially over the course of the last year, we don’t think too many investors will risk shorting gold going into the elections. Also a plus for gold, is the fact that the political landscape in Washington has become murkier ever since Friday’s health care defeat, imperiling the success of future legislation that in turn could hamper gold’s rally.