Gold and Silver Flat, U.S. Deficit on Track for $1.3 Trillion
Both precious metals experienced a dull trading day as the U.S. dollar (NYSE:UUP) edged higher. The Treasury Department reported that the U.S. government ran a budget deficit of almost $200 billion in March, higher than expectations of $196 billion. For the first six months of fiscal 2012, the deficit totaled $779 billion, compared to $829 billion in the first half of 2011.
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Although the deficit was lower for the first six months, the Treasury still estimates that the deficit for the full year will be $1.3 trillion. It will mark the fourth consecutive year of a deficit above $1 trillion. “The government budget deficit is still bursting at the seams with little chance that either side of the aisle is willing to shake hands and get a deal done. The economy is growing again but we can’t grow our way out of these trillion dollar deficits,” explained Chris Rupkey, chief financial economist at Bank of Tokyo-Mitsubishi, according to Bloomberg.
In afternoon trading, the SPDR Gold Trust (NYSEARCA:GLD) declined .10 percent, while the iShares Silver Trust (NYSEARCA:SLV) fell .60 percent. Gold miners (NYSEARCA:GDX) such as Goldcorp Inc. (NYSE:GG) and Newmont Mining (NYSE:NEM) dropped 1.8 percent and 2.13 percent. Silver Wheaton (NYSE:SLW) and Silvercorp Metals Inc. (NYSE:SVM) both declined about .90 percent.
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Disclosure: Long EXK, AG, HL, PHYS