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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Gold's Price Peak Sparks Investor Debate
Gold prices have soared to a new all-time high of over $2,250 an ounce, marking a 38% increase from its 2022 low. Some experts, like Tim Hayes of Ned Davis Research, say this surge in gold prices is seen as even more bullish than the current positive trends in stocks. However, others advise that gold should serve as a diversification tool rather than a primary investment in portfolios. Notably, Warren Buffett, a prominent investor, traditionally avoids gold, underscoring its distinct role compared to stocks or bonds.
READ MOREGold Price Trades With a Positive Bias for the Sixth Straight Day
Gold prices have continued to rise for the sixth consecutive day, nearing the record highs set just the day before, around $2,265-$2,266. This surge is happening against a backdrop of increasing doubts about the Federal Reserve's potential to lower interest rates three times within the year, spurred by positive U.S. manufacturing data. Additionally, escalating geopolitical tensions in the Middle East are dampening investors' willingness to engage with riskier assets, further boosting gold's appeal as a safe-haven asset amidst a stronger U.S. dollar and a generally softer risk sentiment in the market.
READ MOREHousing Costs Drive a Wedge Between Fed’s and Popular Inflation Metrics
The discrepancy between the Federal Reserve's favored inflation metric, the Core Personal Consumption Expenditures (PCE) index, and the more commonly followed Consumer Price Index (CPI) has reached one percentage point difference, largely due to divergent approaches in calculating housing costs. This gap widens to 1.5 percentage points when focusing solely on shelter expenses, although this is partially balanced out by other factors. A recent analysis by Wells Fargo's economists, Sarah House and Aubrey George, delves into these variances, highlighting the significant impact of how shelter costs are factored into these crucial economic indicators.
READ MOREOil Reaches $85 for the First Time Since October
U.S. crude futures reached $85 for the first time since October, driven by a mix of OPEC+ production cuts, sustained strong demand, and rising geopolitical tensions. The surge saw West Texas Intermediate (WTI) futures climb by up to 1.8% in New York, with the global Brent benchmark closely approaching $89 a barrel. This price jump is attributed to the effective market tightening by OPEC and its allies, alongside enduring high global consumption levels.
READ MOREAnalyst Says Silver Could Be Headed to $50
Silver, often dubbed the "poor man's gold," is on the brink of a significant technical breakout, mirroring the momentum gold has recently experienced. The recent surge in gold prices, achieving new highs, sets a compelling backdrop for silver's potential breakout. The extended consolidation period silver has undergone hints at a significant upside once it overcomes resistance. This could not only propel silver towards the $30 mark again but, more ambitively, drive it towards its historic high of $50, catalyzed by technical buying reflective of its prolonged accumulation phase.
READ MOREConcerns Over Yen's Decline Prompt Japan to Consider Market Actions
Japanese Finance Minister Shunichi Suzuki expressed concern over speculative trading in the currency market, which he believes is leading to an excessive decline in the yen's value that doesn't align with economic fundamentals. During a parliamentary address, Suzuki emphasized the government's readiness to intervene in the market to counteract these excessive fluctuations, stating that all options are on the table. He attributed the yen's movements to various factors, including the Bank of Japan's shift from negative interest rates, Japan's current account balance, price changes, geopolitical risks, and market sentiment.
READ MOREInflation Shows Signs of Cooling Off, But Concerns Remain High
Inflation rates have shown a significant decrease to 3.2% in February from a peak of 9.1% in June 2022, marking a decline from the highest levels observed, as per Trading Economics data. However, this rate still exceeds the preferable sub-2% rate seen before the pandemic, indicating inflation remains a concern. Inflation's impact reduces the purchasing power of cash substantially, with a 3% rate diminishing it by about a third over ten years. This trend of inflation exceeding the 2% target has persisted since 2021, underscoring ongoing economic challenges despite recent improvements.
READ MOREOil Markets React to Missile Strike in Damascus Sparks Fear
On the first day of Q2 trading, crude oil futures experienced a price increase following reports of a missile strike on the Iranian consulate in Damascus, Syria. West Texas Intermediate for May delivery rose by 54 cents to $83.71 a barrel, while Brent for June delivery climbed 42 cents to $87.42 a barrel. Reports indicated that the strike, attributed to Israel, resulted in casualties including Mohammad Reza Zahedi, a senior commander of Iran’s Revolutionary Guard. Analyst Leo Mariani suggested that this incident could escalate Middle Eastern conflict, potentially driving oil prices higher in the near term.
READ MOREGlobal Recession Odds are 50/50 Citigroup Warns
Citigroup analysts have recently indicated that the likelihood of a global recession is now almost 50%, exacerbated by rapid interest rate hikes by central banks aimed at combating inflation. This inflation spike has been attributed to the aftermath of the Ukraine conflict and the ongoing COVID-19 pandemic. The analysts warn that the path to disinflation could significantly hinder growth, reflecting a grim outlook for global economic expansion over the next year and a half. Similarly, Barclays has highlighted the fragility of the global economy, projecting a slowdown to just 1% growth for developed economies in 2023, with the euro area expected to slip into recession by the end of the fiscal year.
READ MOREGold Soars to New Heights as Fed Rate Cut Hopes Intensify
The price of gold reached an all-time high, fueled by anticipation of potential Federal Reserve interest rate cuts, amid ongoing geopolitical conflicts and strong demand from China. The price of bullion surged to $2,265.73 an ounce, a 1.6% increase from its previous close, continuing its streak of record-setting performances. This rally has been partly driven by the latest data on the Fed's preferred inflation measure, the core personal consumption expenditures index, which showed a decrease in February, signaling a possible easing in borrowing costs despite the Fed's cautious stance.
READ MOREGold Prices Shatter Records: Inflation Data Fuels Rate Cut Speculations
Gold prices soared to a new record high, as expectations for U.S. interest rate cuts gained momentum following the release of encouraging inflation data. On Monday, gold futures climbed by more than $40, reaching $2,278.30 an ounce, marking a historic peak. This surge is part of a broader trend, with gold finishing March with an 8.9% increase and closing the quarter up by 8%. The rally in gold prices is largely attributed to recent U.S. inflation figures coming in below expectations, suggesting the Federal Reserve might consider reducing interest rates as early as June. The anticipation grew after data showed the Fed's preferred inflation measure, the core deflator, slowed to 0.3% in February from 0.5% the previous month.
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A Closer Look at HSBC’s New Gold Token
Will HSBC’s new gold token mark the start of a new era in gold investing? Or is it simply another ‘paper gold’ mirage?
READ MOREBlackRock's Larry Fink Sounds Alarm on America's Mounting Debt Crisis
Larry Fink, CEO of BlackRock, the world's largest asset manager, has issued a dire warning about the United States' escalating national debt, now exceeding $34 trillion. Echoing concerns raised by Jamie Dimon and Jerome Powell, Fink emphasizes the urgency of the situation, likening potential outcomes to Japan's economic stagnation during its 'lost decade.' He highlights the peril of assuming that investors will indefinitely support the U.S.'s growing fiscal deficit. Additionally, Fink points out the danger of the recent rise in U.S. Treasury yields to 4%, a result of inflation expectations and the Federal Reserve's aggressive rate hikes.
READ MOREWorld Gold Council: Why Are Gold Prices Rising?
Despite a buoyant market with a strong dollar and high returns from stocks and cryptocurrencies, gold prices have surged to unprecedented heights. Notably, after achieving a record peak in mid-March, the price of gold remained robust, standing at $2,195.24 per ounce as of March 28, closely following a spike to $2,222.39 just a week before. The World Gold Council explores why gold prices have been taking off...
READ MOREGold's Stellar Month Tipped by Fed's Monetary Hints
Gold is set to achieve its most significant monthly increase since November 2022, driven by expectations of U.S. interest rate cuts, robust demand for safe-haven assets, and substantial purchases by central banks. With a 0.8% rise to $2,212.47 per ounce and heading for an over 8% monthly and a consecutive quarterly increase, gold reached a record high last week, bolstered by the Federal Reserve's forecast of three rate cuts in 2024. The precious metal remains close to its peak, as investors await further U.S. economic data that could sway the Fed's future monetary decisions.
READ MORENo Immediate Rate Cuts: Fed Takes Cautious Stance on Inflation
Federal Reserve Governor Christopher Waller emphasized the need for patience in adjusting short-term interest rates amidst recent inflation data that hasn't met expectations. Speaking at the Economic Club of New York, Waller suggested maintaining the current rate to ensure inflation moves back towards the Fed's 2% target, indicating a cautious approach towards any potential rate cuts later in the year. Despite the setback in inflation, Waller remains open to adjusting rates if progress on inflation is observed, highlighting the Fed's flexibility in response to economic indicators. The stance reflects a strategic wait-and-see approach, leveraging the strong economy to justify the current restrictive monetary policy while remaining vigilant on inflation trends.
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Beware of Synthetic Gold!
Discover the truth behind HSBC’s claim of tokenizing gold with Mike Maloney and Alan Hibbard.
READ MOREWhy This Gold Bull Market Could Be Very Different
This current bullish trend in the gold market is unique due to widespread optimism among analysts, traders, and bankers, albeit with some caution. The anticipation of a rise to $2,500 per ounce is fueled by favorable financial conditions, including interest rate cuts by major central banks like the Swiss National Bank, expected similar actions by the US Federal Reserve and others, election year dynamics, and ongoing wars. Gold recently hit a record high of $2,221 but needs to consistently break through this level for sustained growth. The silence from informed dealers adds to the intrigue.
READ MOREGold’s Behaviour Points to Sustained Strong Demand
March has seen gold's price soar, hitting a new record of USD 2,221 per ounce, fueled by the Federal Open Market Committee's (FOMC) announcement of three projected rate cuts this year. Despite a slight dip following a surge in the dollar, gold is on track for a 7% gain this month, with silver not far behind at a 10% increase. This rally comes after both metals faced declines earlier in the year, reacting to rising dollar values and U.S. Treasury yields, which were influenced by higher inflation expectations and reduced rate cut forecasts.
READ MORELarry Fink Critiques India's Gold Obsession: Little Economic or Investor Benefit
BlackRock's Larry Fink has pointed out that India's deep-rooted love for gold hasn't significantly benefitted its economy or yielded strong returns for investors. In his annual letter, the BlackRock Founder and Chairman reflects on discussions with Indian policymakers during his visit last November, highlighting their concerns over the nation's gold consumption. Despite its cultural significance and status as a symbol of wealth, Fink notes, gold's performance has lagged behind the Indian stock market, offering little in terms of economic stimulus.
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