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Gold has traded between $1,136 and $1,143 so far today…as of 11:15 am Pacific, bullion is up $3 an ounce at $1,138…Silver is down 13 cents at $15.94…Copper has retreated 6 cents to $2.49…Nickel is 14 cents lower at $4.90…Crude Oil is up 17 cents to $52.17 while the U.S. Dollar Index has added one-fifth of a point to 103.03…

The Gold market continues to see persistent selling pressure as hedge funds and money managers shed long positions and increase their short bets ahead of the New Year, according to the latest data from the Commodity Futures Trading Commission…however, the market still isn’t negative enough to signal a bottom…

BMO Capital Markets has trimmed price targets for Gold, Silver and equities in the sector for 2017, although analysts still describe themselves as generally “constructive” on shares of mining companies.  “On one hand, the downgrade of our Gold and Silver outlook for 2017 is a clear message to investors that we believe a key element of an investment thesis of the precious metal sector is likely to be absent through most of 2017. Given strong sector fundamentals, valuations for the Gold and Silver companies under coverage remain reasonable, in our view, even accounting for our more conservative outlook for Gold and Silver prices in 2017.”

The Chinese Academy of Social Sciences (CASS) today forecast that China’s economic growth will slow again next year to 6.5%, which would be the weakest pace in more than 25 years, down from expected growth of around 6.7% this year…

Trump’s Pick For Budget Director Could Be Dollar Bullish

In an appointment that raises eyebrows among those who expect an explosion in U.S. debt under Donald Trump, Republican Rep. Mick Mulvaney was chosen Friday by the President-elect to be his new budget director…Mulvaney is a fierce deficit hawk with a record of pushing deep spending cuts across the federal government to balance the budget…the 49-year-old from South Carolina rode the Tea Party wave in 2010 and was just re-elected to a 4th term…he’s a co-founder of the House Freedom Caucus that pushed former Speaker John Boehner from power…as director of the White House Office of Management and Budget, Mulvaney would be responsible for Trump’s budget submissions to Congress…those budgets are likely to address campaign promises to repeal Obamacare, cut taxes broadly, and boost military and infrastructure spending…

The extent of U.S. annual budget deficits over the next couple of years will be one of the keys to Gold’s direction.

Actually balancing the federal budget will require deeper spending cuts than the GOP-controlled Congress can probably deliver on, especially if Trump prevails on revenue-losing tax cuts and a big infrastructure package next year…

Trump:  “Right now we are nearly $20 trillion in debt, but Mick is a very high-energy leader with deep convictions for how to responsibly manage our nation’s finances and save our country from drowning in red ink. With Mick at the head of OMB, my administration is going to make smart choices about America’s budget, bring new accountability to our federal government, and renew the American taxpayer’s trust in how their money is spent.”

Untangling the knots around the U.S. economy caused by 8 years of over-regulation and over-taxation by Obama may take the Trump administration more time to fix than most investors currently expect, so any disappointment on the growth front coupled with rising interest costs and fractious negotiations on the debt ceiling could produce a bullish environment for Gold before the end of Q1…

In Today’s Morning Musings…

1. Energy-related plays that investors can profit from in the days and weeks ahead…

2. Three non-resource (and non-marijuana) stocks that are significantly outperforming the Venture…

3. Updated Silver charts – 16 isn’t so sweet…

4. Daniel’s Den…where is Ma Yellen leading us to?…

Plus more…click here to read the rest of today’s Morning Musings and all BMR exclusive content, through a risk-free Pro, Gold or Basic package, or login with your username and password…