Gold and silver moved higher overnight on follow-through from yesterday. Weak US inflation data, uncertainty over Brexit have lent support. It is also possible that concerns about Boeing have contributed to some safe-haven buying.
The British Parliament voted a resounding "no" on the latest Brexit deal late Tuesday, which sent the British pound back to the lows of the day but seemed to spark only minor declines in gold and silver. Earlier in the day, US inflation data came in soft, and this lent support to the metals on ideas that the Fed would keep with its "on-hold" strategy regarding interest rates.
US CPI rose 0.2 percent in February, the first time it has increased in four months, but the annual gain was the smallest in nearly 2 1/2 years.
The uncertainty regarding Brexit may have triggered some safe haven buying, but we would argue that the dollar action is the key. The UK parliament has another vote today to decide whether they just leave the EU without a deal in place. A "yes" vote may spark some more interest in the metals, but traders should also be cognizant of the currency effect. If the pound gets hit hard, it could support the dollar and pressure gold and silver.
The release of US PPI, Durable Goods and Construction Spending reports later today could also affect the market's mood. Week data would support the metals.
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