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Gold, silver up, at 5-week highs, on safe-haven, technical buying – Kitco NEWS

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(Kitco News)Gold and silver prices are moderately up and have hit five-week highs in midday U.S. futures trading Wednesday. More safe-haven demand is featured at mid-week, as the economic ramifications from the coronavirus outbreak remain very uncertain. The near-term technical postures for both metals have also turned more bullish, which is inviting the chart-based buyers to the long side of the markets. April gold futures were last up $8.00 an ounce at $1,611.60. March Comex silver prices were last up $0.155 at $18.305 an ounce.

Risk aversion in the global marketplace has receded Wednesday. It appears the spread of the coronavirus illness (now officially called covid 19) to humans has slowed and that’s somewhat encouraging to the marketplace. However, the economic consequences of the outbreak are still playing out. What traders, investors, analysts and other market watchers are discovering is that the global supply chain sees many of its links in China, and with much of China’s population still in quarantine, many global businesses—especially manufacturers–are suffering and may continue to do so for a while. There are anecdotal reports coming out of China that paint a dire picture of the situation there, regarding local commerce. The uncertainty regarding when the global supply chain will return to normal is likely to continue to squelch trader and investor risk appetite for at least the near term. That’s bullish for the precious metals markets.

The key outside markets today see crude oil prices higher and trading around $53.35 a barrel. Meantime, the U.S. dollar index is up and hit another multi-month high in midday U.S. trading. The greenback bulls have flexed their muscles lately, partly on safe-haven demand amid the heightened global uncertainty.

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Technically, April gold futures prices closed nearer the session high and hit another five-week high today. The bulls have the solid overall near-term technical advantage. A three-month-old price uptrend is in place on the daily bar chart. Gold bulls’ next upside near-term price breakout objective is to produce a close above solid technical resistance at the January high of $1,619.60. Bears’ next near-term downside price breakout objective is pushing prices below solid technical support at this week’s low of $1,581.80. First resistance is seen at today’s high of $1,614.40 and then at $1,619.60. First support is seen at today’s low of $1,602.40 and then at $1,600.00. Wyckoff’s Market Rating: 8.0

Live 24 hours silver chart [ Kitco Inc. ]

March silver futures prices closed near mid-range and hit a five-week high today. The silver bulls have the overall near-term technical advantage. Silver bulls’ next upside price breakout objective is closing prices above solid technical resistance at the January high of $18.895 an ounce. The next downside price breakout objective for the bears is closing prices below solid support at the January low of $17.28. First resistance is seen at today’s high of $18.39 and then at $18.50. Next support is seen at today’s low of $18.135 and then at $18.00. Wyckoff’s Market Rating: 6.0.

March N.Y. copper closed up 20 points at 260.60 cents today. Prices closed near mid-range today. The copper bears have the overall near-term technical advantage. However, recent upside price action suggests a market bottom is in place. Copper bulls’ next upside price objective is pushing and closing prices above solid technical resistance at 270.00 cents. The next downside price objective for the bears is closing prices below solid technical support at the February low of 248.75 cents. First resistance is seen at this week’s high of 263.25 cents and then at 265.00 cents. First support is seen at today’s low of 257.75 cents and then at 255.00 cents. Wyckoff’s Market Rating: 3.0.

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Keystone pipeline temporarily closed following Kansas oil spill

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The energy company in charge of the pipeline has not said what caused the spill or how much oil was released.

The Keystone pipeline has halted operations following an oil spill into a creek in the United States state of Kansas. The pipeline carries more than 600,000 barrels of oil from Canada to the Texas Gulf Coast each day.

Canada-based TC Energy said in a press release that it shut down the pipeline on Wednesday night in response to a drop in pipeline pressure. The company has yet to offer information on the scale and cause of the spill.

“The system remains shut down as our crews actively respond and work to contain and recover the oil,” the release said.

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The spill resulted in oil leaking into a creek in northeastern Kansas and the company has said they were using machinery to prevent the oil from moving further downstream. Pipelines have long spurred concerns about the destructive potential of oil spills.

Another pipeline previously proposed by TC, the Keystone XL pipeline, would have been 1,930 kilometres (1,200 miles) long and cut across US states such as Montana, South Dakota and Nebraska.

That proposal spurred strong opposition from advocates who said it would increase the chance of spills, undermine the rights of Indigenous communities and worsen climate change.

Former President Donald Trump approved a permit for the contentious project in 2017 but a court halted construction in 2018 before the permit was cancelled by President Joe Biden’s administration last year.

TC finally abandoned the effort in June 2021 but has since filed a claim seeking remuneration for losses it says it faced because of the cancellation.

The spill on Wednesday occurred several years after the Keystone pipeline leaked about 1.4m litres (383,000 gallons) of oil in eastern North Dakota in 2019.

As word of the shutdown spread on Wednesday, oil prices ticked upwards by about five percent.

“It’s something to keep an eye on, but not necessarily an immediate impact for now,” said Patrick De Haan, head of petroleum analysis at GasBuddy, which tracks gasoline prices, according to the Associated Press. “It could eventually impact oil supplies to refiners, which could be severe if it lasts more than a few days.”

In their statement, Keystone said their primary focus was the “health and safety of onsite staff and personnel, the surrounding community, and mitigating risk to the environment through the deployment of booms downstream as we work to contain and prevent further migration of the release”.

Previous Keystone spills have resulted in stoppages that lasted up to two weeks. However, analysts have noted that the current stoppage could possibly last longer because it involves a body of water.

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Bank of Canada policy will ‘hit home’ in 2023: David Rosenberg

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The Bank of Canada may be signalling a possible end to its months-long aggressive interest-rate hike cycle, but economist David Rosenberg said next year will see the lagging impact of 2022’s monetary policy “hit home” for Canadians.

“Next year is the payback,” Rosenberg, chief economist and strategist at Rosenberg Research and Associates Inc., said in an interview with BNN Bloomberg.

“2022 was the year of the sharp run-up in rates, 2023 will be the year where the policy lags from those rising rates hit home.”

He made the comments Thursday, a day after the Bank of Canada raised its overnight lending rate by 50 basis points to 4.25 per cent, as the central bank continued with its approach to bringing down inflation.

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Rosenberg predicted a “severe recession” for Canada next year based on the rate hike cycle, calling for a “triple whammy” with economic impacts compounded by high levels of household debt, a housing bubble and ripples in the global economy.

Possible spillover effects from the interest rate cycle could be felt, Rosenberg said, as banks may constrain the availability of credit and spending drops across various sectors.

Based on the latest rate increase, Rosenberg said he predicts at potentially one more rate hike from the bank before a pause. Once inflation starts to come down, Rosenberg said he thinks the central bank may start to cut rates, possibly in the second half of 2023.

“The next stage is going to be waiting for the inflation to come down, which I think it will, and the recession is going to catch a lot of people by surprise,” he said.

A similar pattern may play out in the U.S., but Rosenberg said Canadians are more exposed to higher interest rates through variable-rate mortgages and because more consumer credit is tied to short-term interest rates.

“As bad as it’s going to be in the U.S., and believe me, it’s not going to be a pretty picture there, I think the Canadian situation in the next year is going to be clouded at best,” he said.

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CRTC rejects Telus’ request to charge credit card processing fee for some services

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The Canadian Radio-television and Telecommunications Commission ruled Thursday that Telus is not able to charge a credit card processing fee for regulated home telephone services.

This ruling applies to Alberta and B.C. services that are regulated by the CRTC, which are generally home telephone services in certain smaller communities.

Since Oct. 6, most Canadian businesses, except in Quebec, can charge their customers a fee for credit card transactions, following a class-action lawsuit filed by retailers against Visa, MasterCard and card-issuing banks.

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Quebec is not included in this decision due to the province’s Consumer Protection Act, which prohibits the application of such surcharges.

On Aug. 8, Telus filed an application with the CRTC to introduce a credit card processing fee of 1.5 per cent, plus taxes, for payments made with a credit card.

On. Oct. 17, Telus began to charge the fee to clients paying by credit card in areas where services are not regulated by the CRTC, which includes its wireless and internet customers outside of Quebec.

Telus does not need to ask for the CRTC’s approval to add the surcharge to its unregulated services but the organization said it is “very concerned” about this practice as it goes against affordability and consumer interest.

“We heard Canadians loud and clear: close to 4,000 of you told us that you should not be subjected to an additional fee based on the method you choose to pay your bill,” Ian Scott, chairperson and CEO of the CRTC, said in a statement. “We expect the telecommunications industry to treat Canadians with respect and do better.”

The CRTC said, with this ruling, it is sending a “clear message” to Telus and other telecommunications service providers that are thinking of imposing a fee like this one on their customers.

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