Precious Metals News Update - 28 February 2018

Hello everyone.
 
The markets’ verdict on the prepared Testimony and subsequent Q&A of US Federal Reserve Chairman Jerome Powell before the House Financial Services Committee, came down on the side of “hawkish”.
 
Specifically, Chairman Powell stated the following:
 
"Some of the headwinds the U.S. economy faced in previous years have turned into tailwinds,"
"Despite the recent volatility, financial conditions remain accommodative. At the same time, inflation remains below our 2% longer-run objective."
"Further gradual increases in the federal funds rate will best promote attainment of both of our objectives,"
“Risks of recession are not at all high at the moment,”
 
These comments sparked a rebound in the US Dollar, higher US 10 Year Treasury yields, and a retreat in US equity prices, all of which drove precious metals values significantly lower by the close of trading on Tuesday.
 
Elsewhere, Commerzbank highlighted in its ‘Commodities Daily’ that: “China imported not only gold in January…but also a lot of silver. According to data from the customs authorities, 493 tons were imported, 85% more than last January. At the same time, this constituted the highest monthly silver imports in 7½ years. The global silver market was not in tight supply in January nonetheless because ETF investors sold nearly 400 tons of silver last month. China also imported more palladium in January (+18%). By contrast, platinum imports decreased by just shy of 7%.”
 
Also highlighted was a pending decision from Germany’s Federal Administrative Court in relation to the legality of banning diesel cars from German cities. The Court went on to hand down a decision that will allow Stuttgart and Duesseldorf to legally ban older diesel vehicles. The prospect of decreased demand for diesel vehicles stemming from this decision spilled over into platinum, as prices were driven lower on the probability of a corresponding decline in demand for the industrial metal which is used in catalytic converters.
 
Technically, very little changed as choppy / range-driven trade continued in XAU/AUD, the market dropped down to support at its 21 Day moving average at AUD 1690 and the next line of defence now emerges at the 55 Day moving average at AUD 1675.00. Major technical resistance remains intact at AUD 1715.00.
 
XAU/USD slid to within striking distance of the lower bounds of its broader USD 1306 to USD 1366 sideways trading band.
 
And on a final note, the US Debt Clock makes for some interesting (sobering?) reading as below ( http://www.usdebtclock.org/index.html for real-time updates):
 
Good luck.
 
Regards,
Andre