Gold and Silver Break Winning Streak, U.S. Deficit to Top $1 Trillion…Again

On Monday, gold (NYSEARCA:GLD) futures for April delivery decreased $11.70 to settle at $1,699.80 per ounce, while silver (NYSEARCA:SLV) futures fell 80 cents to close at $33.41.  Despite new budget deficit data, both precious metals broke their three  session winning streak.

The Treasury Department reported on Monday that the United States government ran a budget deficit of $231.7 billion in February, an increase from $222.5 billion a year earlier.  The budget deficit for the first five months of the fiscal year hit $581 billion.

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The federal deficit is expected to top $1 trillion for the fourth consecutive year.  The Congressional Budget Office projects that the deficit will decrease slightly to $1.08 trillion this year, compared to almost $1.30 trillion last year.

In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) edged .70 percent lower, while the iShares Silver Trust (NYSEARCA:SLV) declined 1.84 percent.  Gold miners (NYSEARCA:GDX) such as Barrick Gold Corp. (NYSE:ABX) decreased .79 percent, while Newmont Mining (NYSE:NEM) and Yamana Gold (NYSE:AUY) dropped 2 percent and 3.4 percent, respectively.  Silver Wheaton Corp. (NYSE:SLW) decreased 1.7 percent.  Silver miners (NYSEARCA:SIL) such as First Majestic Silver (NYSE:AG) and Endeavour Silver (NYSE:EXK) both fell more than 2 percent.

Data from EPFR Global, which provides fund flows and asset allocation data to financial institutions around the world, shows that investors placed more than $200 million into commodities in the week ending March 7.  However, investors placed $404 million into gold and precious metals funds.  Bloomberg explains, “Investors in gold-backed exchange-traded products added to holdings for a seventh consecutive week, taking the total to a record 2,408.4 metric tons valued at $132.7 billion.”

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To contact the reporter on this story: Eric McWhinnie at staff.writers@wallstcheatsheet.com

To contact the editor responsible for this story: Damien Hoffman at editors@wallstcheatsheet.com

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