The month of May is now over, and for gold it was a time of downward momentum. After rising to the US$2,050 per ounce level early on, the yellow metal finished the period at around US$1,960, up from its lowest point of about US$1,940.
This week brought a resolution on the debt ceiling, with US President Joe Biden and Republican House Speaker Kevin McCarthy taking a proposed deal to Congress. By Thursday (June 1), it had made it through both the House and the Senate, allowing the country to avoid a default. The news came only a few days ahead of the deadline, which was set for this coming Monday (June 5).
With the deal now approved, the debt ceiling has been suspended until January 1, 2025.
“America can breathe a sigh of relief,” said Senate Majority Leader Chuck Schumer after the approval.
Aside from that, Wednesday (May 31) brought the latest Job Openings and Labor Turnover Survey (JOLTS) data out of the US. It shows that job vacancies came in at 10.1 million in April — that’s above the amount forecast and higher than the previous month.
The information is stoking expectations that the US Federal Reserve will hike rates at its next meeting, which is scheduled for June 13 to 14. Another point to watch will be the May employment situation report, which is due for release on Friday (June 2).
Namibia news spooks uranium stocks
Moving over to uranium, news out of Namibia caused some turmoil this week. News hit on Monday (May 29) that the country was reportedly thinking about taking minority stakes in mining and petroleum companies operating in the nation.
“We are making a case that local ownership must start with the state, which holds ownership of our natural resources” — Tom Alweendo, Namibia’s minister of mines and energy
The source was the nation’s mines and energy minister, who was speaking to lawmakers, and it sent share prices for a number of Namibia-focused uranium companies sliding — Paladin Energy (ASX:PDN,OTCQX:PALAF), Deep Yellow (ASX:DYL,OTCQX:DYLLF) and Bannerman Energy (ASX:BMN,OTCQX:BNNLF) are among the companies that took hits.
Both Paladin and Deep Yellow were quick to say they keep in contact with the government and were unaware of any legislative changes, and it wasn’t long before the Namibian government stepped forward with a correction.
“The government has no intention of seizing any stake from existing mineral or petroleum licence holders and remains committed to uphold the sanctity of contracts,” the Ministry of Mines and Energy said. New licenses are a different story — Namibia is not ruling out taking minority stakes in mining and petroleum companies that come to the country in the future.
The situation is worth keeping an eye on, but for now it’s worth noting that the week looks to be ending on a positive note for uranium — the commodity made it through the US$55 per pound mark to a new 52 week high.
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