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.
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.”
Investor Insight: Are Investors Still Bullish on Gold?
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