U.S. Treasury Secretary Steven Mnuchin told the Financial Times yesterday that the Trump administration's timetable for tax reform is set at August. But this timetable was deemed as aggressive and unrealistic by analysts. Gold turned higher to $1,291.51 an ounce, bolstered by a softer dollar as President Donald Trump remains under great pressure to push forward its economic policy. Vice President Mike Pence arrived at Japan yesterday, reassuring Japan of American commitment to its safety. But his stance softened against North Korea, saying U.S. seek to solve the North Korea issue in peace. Bullion was driven up jointly by the French presidential election, North Korea tensions, President Trump’s challenge in pushing forward his economic policy, which could fade away as time goes by.
In France, investors remained nervous ahead of the first round of the country's presidential election this Sunday, which will give more guidance to investors. In North Korea, market expects peaceful negotiation to deal with the tensions, instead of resorting to arm forces. The fact that the dollar index had been holding above 99 in the past months despite of setbacks endured by President Trump, suggesting that market participants still have some expectations over his economic policy. Gold is consolidating at highs. Investors shall be cautious and restrain from chasing highs as the metal would be subject to the aforementioned factors.
Spot silver closed at $18.2886 an ounce, slipping for the second consecutive day. On technical front, the metal has a dimmer outlook compared with gold as the daily MACD suggests a rising likelihood of pullback. Investors are recommended to turn to profit-taking from net long positions.

 
Dealing Room, ICBC Beijing Branch
Qin Gang

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