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.
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Investors Eye Fed's Next Moves as Gold Prices Soar to New Heights
Gold prices reached a new record high above $2,350 an ounce but later pared gains, with investors' attention turning towards the upcoming U.S. inflation data set to be released on Wednesday. The anticipation revolves around the Federal Reserve's stance on interest rates, as higher rates generally have a negative impact on gold, which doesn’t yield interest. Despite the lack of a clear catalyst for gold's rally since mid-February, the precious metal has surged over 18%, partly driven by expectations that the Fed might soon reduce borrowing costs and by consistent demand from central banks, notably the People’s Bank of China, which added gold to its reserves for the 17th consecutive month in March.
READ MOREGold's Glitter May Fade: Expert Cautions on Gold's Vulnerability Post-Rally
Despite reaching new all-time highs amid strong U.S. economic data and ongoing geopolitical tensions, gold's future rally may not be guaranteed, according to veteran advisor Bob Parker of the International Capital Markets Association. Parker points out a "catch-up effect" as a significant driver behind the recent surge. This effect refers to gold's attempt to match its past underperformance relative to global equity markets. Additionally, Parker highlights the debated but acknowledged correlation between gold and Bitcoin as influencing gold's appeal. However, Parker also notes the obscure yet impactful role of central bank purchases, especially from Asia, as a key factor in gold's current standing, suggesting a mixed outlook for the metal's future.
READ MORECentral Banks' Gold Rush Propels Prices to Unprecedented Levels
Gold prices have surged to new highs, fueled largely by significant purchases from central banks. On the New York Mercantile Exchange, June futures rose 0.5% to $2,357 per troy ounce, reaching an all-time peak of $2,372.5. This uptick represents a 4.4% gain in the past week and nearly 11% over the past year. A significant factor behind this rally is the consistent increase in gold reserves by central banks, with China's central bank boosting its gold reserves for the 17th consecutive month in March.
READ MOREOil Dips as Tensions Rise: Market Braces for Iran's Next Move Against Israel
Oil prices experienced a decline, with U.S. crude futures dropping as the market anticipates Iran's response to Israel following a missile attack on Iran's consulate in Damascus. West Texas Intermediate (WTI) for May delivery decreased by 60 cents, marking a 0.69% fall, settling at $86.31 a barrel, while June Brent contract dipped by 68 cents, or 0.71%, to $90.96 a barrel. This market movement comes amid warnings from a senior Iranian military advisor to Israel, hinting at possible retaliatory actions against Israeli embassies in response to the attack that resulted in the death of Iranian commander Mohammad Reza Zahedi, for which Tehran holds Israel responsible.
READ MOREYellen Puts China on Notice: U.S. Industries Must Be Protected
U.S. Treasury Secretary Janet Yellen has issued a stern warning to China, signaling that the U.S. will not tolerate the destruction of its emerging industries due to an influx of Chinese imports. During her four-day visit aimed at discussions on excessive industrial capacity, Yellen emphasized that the U.S. aims to prevent a scenario akin to the "China shock" of the early 2000s, which resulted in the loss of approximately 2 million American manufacturing jobs. While she stopped short of proposing new tariffs or trade measures against China's substantial state support for sectors like electric vehicles and solar panels, Yellen criticized China's overproduction and its impact on global markets. Her visit underscores a significant concern over China's export practices and their potential threat to U.S. and other nations' industries.
READ MOREBarron's: Gold Prices Are About to Shoot Even Higher
Gold has been experiencing a notable uptrend, now trading at record levels with predictions suggesting it could reach $4,000 per ounce. This optimistic forecast comes after gold demonstrated a solid bullish reversal, notably overcoming the $1,940 mark without dipping below $1,900, which signaled a buying opportunity. Despite a period of stagnation following an inability to sustain a close above $2,100, a bullish reversal in late February marked a significant improvement in gold's technical outlook. The close above $2,200 has further solidified projections that gold prices could soar to between $3,600 and $4,000, backed by its long-term bullish base and higher high-level consolidations.
READ MORERussia's Central Bank Adapts Gold Buying Strategy Amid Rouble's Rise
Russia's central bank has announced a shift from its previous stance of purchasing gold at a fixed price, moving to negotiate prices with commercial banks starting April 8, due to significant market changes. This decision alters the March 25 declaration of buying gold at a fixed rate of 5,000 roubles per gram through June 30. The adjustment comes as the rouble has appreciated notably against the dollar, increasing the fixed price's value from about $52 to $63, despite stable international gold prices around $60 a gram ($1,900 an ounce). This change is noteworthy for Russia, a leading gold producer, especially since the country's gold refiners have been excluded from the London market, the global hub for gold trading, following military actions in Ukraine.
READ MOREIncrementum Monthly Gold Compass Report
Incremenum shares the company's monthly gold compass report.
READ MORERussia Leads BRICS in Doubling Down on Gold to Dethrone the Dollar
The BRICS nations (Brazil, Russia, India, China, and South Africa) are significantly increasing their gold reserves, making them the leading gold buyers of 2023, according to the World Gold Council. China has added 225 tons of gold, with the other member countries also making substantial purchases. This accumulation is part of a strategy to potentially back a new BRICS currency with gold, challenging the dominance of the US dollar. Russia, in particular, has announced plans to double its gold and foreign currency reserves from April 5 to May 7, 2024, as confirmed by Finance Minister Anton Siluanov. This move aligns with BRICS' broader goal to shift away from using the US dollar for international transactions, a change that could have significant implications for the US economy.
READ MOREMajor Breakout & New Bull Market Confirmed
Gold is currently entering the early phase of a bull market anticipated to extend into the 2030s, marking a significant turning point reminiscent of the breakout in 2005 that led to a six-year period of substantial growth. This optimistic forecast suggests that gold prices could soar to a long-term target of $8,000 to $10,000 by the end of the 2030s. This prediction underscores the strong momentum and positive outlook for gold as an investment, drawing parallels with past cycles of robust growth and investor interest in the precious metal.
READ MOREZimbabwe Introduces ZiG: A New Currency Backed by Gold
Zimbabwe has announced the introduction of a new currency, the Zimbabwe Gold (ZiG), which will be backed by gold, other precious metals, and foreign currencies. This initiative, announced by Central Bank Governor John Mushayavanhu, aims to bring "simplicity, certainty, and predictability" to the nation's financial system. The transition to ZiG starts from April 5, with an initial interest rate set at 20%, a significant reduction from the previous rate of 130%. This change comes in response to the local dollar's drastic devaluation and soaring annual inflation, which reached 55% in March. The central bank's decision follows extensive discussions with the finance ministry, aiming to address the currency's sharp decline and the challenges in providing change in foreign currency transactions.
READ MOREGold Prices Soar to New Heights Defying Critics
On Friday, gold prices soared, setting a new record high amidst a mix of factors, including anticipation of U.S. interest rate cuts, speculative purchases, and robust buying by central banks. Despite the strong job growth reported in March in the U.S., the momentum behind gold has propelled it to its third consecutive week of gains. The price of spot gold rose by 1.3% to $2,320.04 per ounce, peaking at $2,344.50 earlier in the day. This week alone, gold has increased by 3.8%, signaling a sustained upward trend.
READ MOREJobs Report Shakes Up Fed Rate Cut Expectations, Bolsters Dollar
The U.S. economy added an impressive 303,000 jobs in March, substantially outpacing the predicted 200,000, leading to a reevaluation of the Federal Reserve's interest rate trajectory. This robust job growth, detailed in the Labor Department's report, has lessened expectations for an imminent rate cut, with the likelihood of a reduction in June now down to 54.4%. As a result, the dollar strengthened, and U.S. Treasury yields climbed, reflecting investor anticipation that the Fed may delay easing monetary policy due to the strong labor market indicators.
READ MOREMarch Jobs Surge Beats Forecasts, But Wage Growth Sparks Inflation Concerns
The latest March jobs report outperformed expectations, adding 303,000 jobs to the U.S. economy, significantly above the forecasted 214,000, and lowering the unemployment rate to 3.8%. In a discussion on Yahoo Finance, experts Dana Peterson and Brian Levitt analyze the implications for the Federal Reserve's interest rate decisions, emphasizing the double-edged sword of wage growth. While wages remain elevated at 4% compared to the pre-pandemic average of just under 3%, indicating potential inflationary pressures, there is a silver lining with the slowdown in housing inflation. Nonetheless, the persistent high wage growth poses challenges to controlling consumer inflation.
READ MOREInvestors Flock to Gold During Commodity Boom
Nicky Shiels, the head of metals strategy at MKS PAMP, has revised the gold price forecast upward for 2024, sparking curious inquiries from the market on whether gold could mimic the recent explosive price surge seen in cocoa. Cocoa prices skyrocketed, doubling due to poor harvests in major producing countries, Ivory Coast and Ghana. This comparison arises as gold, despite its broader market and liquidity, achieved record highs in five consecutive trading sessions. Investors are increasingly drawn to gold, viewing it as a reliable asset for wealth preservation amidst uncertainties.
READ MOREMining Stocks Lag Behind as Gold Prices Shine: A Rally on the Horizon?
As gold prices ascend, nearing record highs with a more than 20% increase since last October, gold mining stocks remain unexpectedly stagnant. This discrepancy puzzles many, suggesting that either mining stocks must rise to match gold's momentum or gold prices must adjust downward. Leading the optimistic perspective, Christopher Mancini of the Gabelli Gold Fund, emphasizes that gold stocks are bound for an uptick, given they haven't yet reflected the rising gold prices. Despite production costs for mining companies surging by 35% since early 2020, mainly from increased labor expenses, there's a strong belief in the sector's potential for growth if gold continues its upward trajectory.
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Gold and Bitcoin: Vital Challengers to Fiat Currencies
Is Bitcoin truly the digital gold of the 21st century, or is it a fleeting mirage in the investment desert?
READ MORERosenberg Forecasts Gold to Hit Unprecedented $3,000
David Rosenberg, the founder and president of Rosenberg Research, forecasts a significant rise in gold prices, potentially reaching $3,000 or more. Despite gold facing a potential loss in its current session, Rosenberg's optimism is not solely based on the Federal Reserve's actions. He points to a combination of factors fueling this upward trend: an upcoming easing cycle, global economic growth weakening, and inflation nearing the end of its decline. Rosenberg believes these elements will serve as strong tailwinds, propelling gold to new heights in the near future.
READ MOREWill Gold Hit $2,500? Predictions for a Bright 2024
Analyzing gold from both a price and time perspective, the folks at InvestingHaven anticipate the upward trend to persist within the current 3-month cycle, likely peaking around mid-May. The analysis suggests a strong possibility for gold to reach or even surpass $2,500 by May, although it may not sustain this level on a 5 to 8 day closing basis. This projection is based on the current patterns observed in gold's price chart, indicating a continuation of the rally until at least May 2024.
READ MOREPandora's Eco-Friendly Shift: Committing to 100% Recycled Silver and Gold
Pandora, the renowned jewellery brand, has announced a shift to exclusively using recycled silver and gold in its products, aiming to significantly lessen its environmental impact. This move is primarily driven by the desire to cut down on greenhouse gas emissions, as mining for new precious metals is far more energy-intensive and resource-demanding than recycling. The company highlights that recycled silver has only one-third the carbon footprint of newly mined silver, and recycled gold produces less than 1% of the emissions compared to mining new gold. By making this change, Pandora expects to reduce its carbon emissions by around 58,000 tons annually, which is comparable to the yearly electricity use of 11,000 homes or the emissions from 6,000 cars traveling around the world.
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