Silver to $39.50: Up 9.4% Past 30 Days
Daily News Nuggets | August 29th, 2025 — Here’s what you need to know about today’s most important economic and precious metals news:
Inflation Data Opens Door for September Rate Cut
The Fed’s favorite inflation gauge came in exactly as expected this morning. July’s core PCE rose 0.3% for the month and 2.9% year-over-year, while overall PCE climbed 0.2% monthly and 2.6% annually.
This goldilocks data — not too hot, not too cold — gives the Fed cover to cut rates at their September 16-17 meeting. Fed Governor Christopher Waller went public yesterday, backing a quarter-point cut and warning about deteriorating job conditions. He sees more cuts coming over the next 3-6 months as the Fed moves toward a “neutral” 3% rate. The takeaway? Lower rates typically mean higher gold prices.
Consumers Keep Spending Despite Softer Job Market
Americans opened their wallets in July, with spending up 0.5% — the biggest jump since March. But here’s the twist: the job market is cooling fast. Monthly job gains have crashed from 123,000 last year to just 35,000 now, and more workers say jobs are getting harder to find.
The spending surge was driven by durable goods purchases, suggesting consumers might be front-running potential tariff increases. Personal income also rose solidly, giving shoppers more firepower despite the shakier employment picture. Real (inflation-adjusted) spending climbed 0.3%, powered by both goods and services.
This split personality economy — strong spending but weakening employment — is exactly when investors turn to gold and silver. The metals thrive on uncertainty, and we’ve got plenty of that.
Central Banks Face Global “Reckoning”
Former UK Prime Minister Liz Truss dropped a bombshell this week, warning that central banks worldwide face a credibility crisis. She’s backing Trump’s Fed criticism, part of a growing chorus questioning whether central banks have too much unchecked power. This comes as U.S. GDP was revised up to 3.3%, driven by AI and tech growth — adding another layer of complexity to the Fed’s decision-making.
When trust in central banks erodes, gold shines. It’s the ultimate hedge against policy mistakes and institutional uncertainty. As more voices question Fed independence, expect safe-haven flows into precious metals.
Your Electric Bill is Funding the AI Revolution
Get ready for sticker shock on your next power bill. Electricity rates jumped 6.5% nationally over the past year. Maine residents got slammed with a 36% increase, while Connecticut saw 18% spikes.
The culprit? AI data centers that could triple their share of national electricity use to 12% by 2028. But it’s not just about raw demand — aging power grids need massive upgrades to handle the load, and data centers are straining infrastructure from coast to coast. Energy Secretary Chris Wright admits the GOP will likely get blamed at the polls for rising rates, while utilities are increasingly relying on fossil fuel plants to meet crushing demand.
Rising electricity costs feed directly into inflation — and inflation feeds directly into gold demand. As AI’s appetite for power grows, so does the case for inflation hedges.
Festival Season Could Ignite Gold’s Next Rally
After weeks on the sidelines, Indian jewelers are back — paying premiums up to $4 per ounce over spot as they rush to stock up for October’s Dussehra and Diwali festivals. Local prices around 102,000 rupees per 10 grams suddenly don’t look so scary after three months of stability.
Their timing could prove shrewd. Gold touched $3,415 on Friday morning, up 1.1% for the week and approaching its $3,500 record. Despite strong U.S. growth, traders are betting on September rate cuts (85% probability) while Fed independence concerns mount.
Why it matters: When the world’s second-largest gold consumer starts buying again, it matters. Indian festival demand has historically provided the rocket fuel for major gold rallies. With Western investors already positioning for rate cuts and institutional uncertainty, renewed Eastern buying could be the catalyst that finally pushes gold into record territory. The stars are aligning — monetary policy tailwinds from the West, and strong physical demand from the East.
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