Gold and Silver Industry & Investing News
Today’s gold and silver market news, curated from the best of GoldSilver's team and around the web. Everything precious metals investors need to know including updates on big price swings, macro analysis, and breaking stories. Check back often or subscribe to get the highlights in your inbox. Monitor live spot prices on our charts page.
Subscribe
Manufacturing Upswing Propels Copper Toward $10,000 as Supply Struggles Loom
Copper prices are approaching a significant milestone of $10,000 per ton, reaching a new two-year high due to ongoing supply concerns and robust investor interest. The metal's price surge is supported by global manufacturing improvements in regions like the U.S. and China, despite potential setbacks from geopolitical tensions and uncertainties in monetary policy. Originally sparked by disruptions in major mining operations, the rally continues as the market anticipates a recovery in global manufacturing that could stabilize and further boost demand, especially with the seasonal recovery expected in China.
READ MOREDollar Rallies After Volatile Week; Yen Hovers Near Historic Lows
After a notably turbulent week in currency markets, the dollar experienced gains against the euro and yen, propelled by ongoing assessments of policy and geopolitical developments. As traders keep a close watch on the yen ahead of the Bank of Japan's policy review, the currency teeters near a 34-year low against the dollar, sparking speculation about potential intervention. Meanwhile, despite a recent retreat from five-month highs, the dollar's trade-weighted index remains above 106, influenced by Federal Reserve officials’ comments and recent inflation data, which have tempered expectations for imminent rate cuts.
READ MOREOpinion: Do Interest Rates Matter Anymore?
Despite the Federal Reserve's aggressive interest rate hikes—increasing rates 11 times from zero to 5.5% between March 2022 and January 2024—the U.S. economy has shown resilience with growth near 3%, stable unemployment, and strong performances in commodities and stock markets. However, the outlook for interest rates remains uncertain; while initial predictions favored six rate cuts in 2024, recent inflation trends have adjusted expectations to possibly only two cuts, as noted by Goldman Sachs. Federal Reserve Chair Jerome Powell has suggested that it may take longer than anticipated to curb inflation sufficiently to lower rates, with former Treasury Secretary Lawrence Summers even hinting at the possibility of another rate hike.
READ MOREEconomic Worries Fuel Gold Rush in China Despite Rising Costs
Despite the challenges posed by a faltering economy and a depreciating yuan, Chinese consumers and the central bank are increasingly investing in gold, driving the price to record highs above $2,400 an ounce. The allure of gold, a traditional safe-haven asset, has intensified amid global economic and geopolitical instability. Additionally, anticipations of interest rate cuts by central banks, which tend to reduce yields on bonds, are making gold an even more attractive investment. The weakening yuan, which has dropped about 5% against the US dollar over the past year, further exacerbates the cost for Chinese buyers, yet does not deter their demand.
READ MOREGold Prices Dip as Middle East Conflict Cools, Market Eyes Upcoming U.S. Economic Indicators
Gold prices fell more than 2% to approximately $2,345 per ounce, reversing a five-week upward trend—the longest in over a year—as tensions in the Middle East began to subside. The decrease in geopolitical risk followed Iran's understated reaction to recent Israeli strikes, indicating a lower likelihood of immediate retaliation. This shift has reduced the market's risk premium, particularly as bullish sentiment on oil also receded on Monday, further reflecting easing tensions in the region. These developments come as traders eagerly anticipate upcoming U.S. economic data, which is expected to provide clearer insights into future monetary policy directions.
READ MOREDefying Conventional Thinking: Gold Gains Against Rising Rates and a Robust Dollar
Despite conventional expectations, gold prices have remained resilient in the face of rising interest rates and a strengthening U.S. dollar, traditionally negative factors for the metal. Typically, higher interest rates draw capital towards bonds due to their attractive yields, diminishing gold's appeal as an investment. Simultaneously, a strong dollar usually suppresses gold prices, as it increases the metal's cost in other currencies, encouraging selling. However, current market trends show that gold has diverged from these historical patterns, maintaining its value despite these adversarial conditions.
READ MOREFederal Reserve Reveals Over 1,800 Banks Accessed Emergency Funds Post-SVB Collapse
The Federal Reserve reported that 1,804 depository institutions, representing 20% of all eligible entities, accessed its emergency lending facility following the collapse of Silicon Valley Bank last March. According to the semi-annual Financial Stability Report, most of these institutions—95% in fact—were smaller entities with assets under $10 billion. The Bank Term Funding Program was established to counteract a liquidity crisis triggered by a sudden surge in withdrawals, which led to the failures of major banks like SVB and Signature Bank, necessitating a swift governmental intervention to stabilize the financial sector.
READ MOREGold Climbs for Fifth Week as Middle East Tensions Heighten Market Uncertainty
Gold prices are on pace for a fifth consecutive weekly increase, driven by heightened tensions between Iran and Israel, which spurred safe-haven buying. As of Friday afternoon, spot gold rose 0.7% to $2,395.15 per ounce, with earlier peaks reaching $2,417.59. Over the week, prices climbed by 2.2%. Meanwhile, U.S. gold futures also saw a similar uptick, closing 0.7% higher at $2,413.8 per ounce. This trend reflects investors' concerns over escalating geopolitical risks and their impact on financial markets.
READ MORECostco Offers Gold, But Reselling Proves Challenging
Buying a gold bar at Costco is as easy as adding it to your cart, but selling it involves more effort and can be less lucrative. Adam Xi, a 33-year-old from Philadelphia, experienced this firsthand. After purchasing a gold bar for $2,000, he struggled to resell it without a loss, contacting five different dealers before settling for a price just $20 below market value at $1,960. Many are discovering that gold is not as liquid an asset as they hoped, facing challenges when they decide to liquidate their investments.
READ MOREInside Job at Toronto Airport Leads to $16.5 Million Gold and Cash Heist
In a significant heist at Toronto's airport, a thief stole $14.5 million in gold bars and nearly $2 million in cash using fake documents to claim a shipment. The scheme, which unfolded last April, was later uncovered as an inside job possibly involving Air Canada employees. The discovery led to a yearlong investigation linking the culprits to an international arms-trafficking operation, which was eventually disrupted by Pennsylvania State Police.
READ MOREElderly Woman Cheated Out of $1 Million in Precious Metals by Scammers
A 70-year-old woman from Carlsbad was scammed out of more than $1 million in gold and other precious metals, according to the San Diego federal prosecutors. The scam started with a pop-up message on her computer claiming she had been hacked. Believing her bank account information was compromised, she was deceived by a group posing as tech support who convinced her to download malicious software. This group has been charged with conspiracy to commit wire fraud.
READ MORERay Dalio Recommends Gold as Shield Against Soaring Global Debt and Inflation
Billionaire investor Ray Dalio advocates for owning gold as a strategic hedge against potential debt and inflation crises. Dalio, the founder of Bridgewater Associates, highlights the escalating global debt, notably mentioning the U.S. debt reaching an unprecedented $34 trillion. He warns of a looming U.S. debt crisis that could lead to a balance sheet recession, adversely affecting major economies like China, Japan, and Europe, and threatening the stability of their currencies.
READ MOREWall Street Watch: U.S. Regulators Set to Rein In Executive Bonuses Amid Financial Scrutiny
U.S. banking regulators are reportedly revisiting a plan to restrict executive bonuses at large banks. This initiative, involving six agencies such as the FDIC and OCC, aims to enforce deferred compensations and enhance clawback measures for bonuses in case of financial losses. The proposal, which could be introduced soon, excludes the Federal Reserve from its drafters. This move comes amid longstanding debates over Wall Street executives' pay and the need for more rigorous financial accountability.
READ MOREZeroHedge: Gold's "Catapult Has Been Built; Silver's is Next"
The time has come to cite the many reasons why Gold has risen, and why Gold will continue to launch to much higher levels. ZeroHedge explains 20 solid reasons for the gold breakout... and why silver will be next.
READ MOREThe Psychology of Inflation: Why Many Dispute Government Inflation Figures
The psychology of inflation plays a significant role because it impacts individuals differently based on their personal circumstances. For homeowners with fixed mortgage rates and minimal debt, inflation may pose little threat to their financial stability. However, for renters, prospective homebuyers, or those needing to purchase big-ticket items or borrow money, inflation can be severely detrimental. This disparity in experiences contributes to widespread skepticism about official inflation figures, as people feel the impacts of inflation vary greatly from what is reported by the government.
READ MOREU.S., Japan, and South Korea Unite to Stabilize Dollar
The Biden administration, along with Japan and South Korea, is taking coordinated action to curb the recent surge of the U.S. dollar against Asian currencies, which has been exacerbated by changing market expectations regarding U.S. interest rates. This collaborative effort was highlighted in a joint statement by U.S. Treasury Secretary Janet Yellen and her counterparts, following a trilateral meeting in Washington. They expressed a commitment to closely monitor and consult on foreign exchange market developments, especially after recent U.S. inflation data prompted a reassessment of anticipated Federal Reserve rate cuts, leading to significant gains for the dollar. The finance ministers also recognized the serious concerns of Japan and South Korea regarding the rapid depreciation of their currencies.
READ MOREMetalsDaily – We need to talk about China...
In his latest article on MetalsDaily.com, Ross Norman highlights the significant purchasing trends on the Shanghai Futures Exchange (SHFE), which offer a glimpse into China's unique perspective on gold. Unlike the prevailing global view, China exhibits a distinct cognitive bias favoring gold, a stance not mirrored by weaker demand in other regions at current price levels. This discrepancy may stem from what's known as "false consensus bias," where people mistakenly believe others share their views. Norman's analysis suggests that understanding China's distinct market behavior is crucial for interpreting global gold trends.
READ MOREUS Treasury Yields Stabilize as Middle East Tensions Ease
After a significant rally, U.S. Treasuries have pared their gains following a de-escalation in Middle East tensions, which refocused attention on inflation expectations. The 10-year U.S. government bond yields dropped slightly by five basis points to 4.59%, nearly reversing an earlier 14 basis point decline. This change occurred after a senior Iranian official indicated that Iran would not immediately retaliate against Israel, easing fears of further conflict escalation. Despite this recent volatility reducing the impact of this year’s earlier sell-off, the 10-year Treasury is on track for a fourth consecutive week of losses. Investors are now anticipating a more gradual approach to monetary easing, reflected in the nearly one percentage point increase in bond yields from their late 2023 low, reaching levels last seen in November.
READ MOREMiddle East Tensions Stir Global Economic Concerns as Oil Prices Climb
Global central bankers are increasingly concerned about the Middle East's volatility and its potential to disrupt their efforts to control inflation. This anxiety was heightened when an Israeli attack on Iran caused crude oil prices to spike by more than 4%, surpassing $90 a barrel, although prices later stabilized somewhat. The incident underscores the delicate balance central bankers must maintain amidst geopolitical tensions that could reignite inflationary pressures. These developments come as world leaders, including UN Secretary-General Antonio Guterres, warn of the region's instability, and as top diplomats from the Group of Seven discuss global threats in Italy, all coinciding with the International Monetary Fund meetings in Washington where the economic implications of these geopolitical tensions are a focal point.
READ MOREGlobal Concerns Rise Over U.S. Economy's Impact on World Currencies
During President Joe Biden's campaign tour in Pennsylvania, he praised the U.S. economy as the strongest globally, but international financial leaders meeting in Washington for the IMF-World Bank spring meetings voiced concerns. They urged moderation, highlighting how the robust U.S. economy, characterized by high interest rates and a strong dollar, has negatively impacted other countries by devaluing their currencies and complicating efforts to reduce borrowing costs. These sentiments were underscored by Federal Reserve Chair Jerome Powell, who announced that expected rate cuts would be delayed due to persistent high U.S. inflation.
READ MORE