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Silver Price News: Silver Ticks Higher in Subdued Trading
Silver prices edged slightly higher on Tuesday, tracking a modest rise in the gold price.
Prices crept up to $30.69 an ounce during the day, although prices eased back to around $30.20 an ounce later in the session. The day’s price action showed a roughly 0.75% gain for silver, compared with around $30.00 an ounce in late trades on Monday.
Silver (KAG) price – $/oz – on the Kinesis Pro exchange
US dollar strength curbs silver’s gains:
Silver’s initial strength on Tuesday came as gold prices made modest gains on Tuesday morning. However, the US dollar gained against other major currencies on Tuesday, putting downward pressure on dollar-denominated gold and silver prices, as a stronger dollar makes the metals more expensive for buyers in other currencies.
2024 seen as another year of supply shortage:
On the fundamental side, total global silver demand is expected to increase by 1% in 2024 compared with 2023, while total supply is expected to rise by 2% year-on-year, according to industry group, the Silver Institute: Silver News December 2024. These figures, taken in isolation, may appear to be slightly bearish for silver prices. However, of greater interest for the price will be recognition that the structural supply deficit was set to continue for a fourth straight year in 2024, standing at 182 million ounces, according to the group’s figures. Read More
Gold Price News: Gold Tests Recent Three-Week Highs
Gold prices nudged higher on Tuesday to test the three-week highs seen on January 3rd, although prices stayed within their recent range as the markets awaited fresh inputs.
Prices climbed to a high of $2,665 an ounce on Tuesday, testing the January 3rd high of $2,666 an ounce. However, the market lacked the momentum to push above this level, leaving prices to ease back down to around $2,650 an ounce later in the session.
Gold (KAU) price – $/g – on the Kinesis Pro exchange
US ISM Services PMI data released on Tuesday showed a larger-than-expected increase in business activity in December, while separate figures showed a larger-than-expected rise in job openings in November. The latest bullish economic figures may be seen as decreasing the chances of US interest rate cuts in the coming months – a bearish factor for gold prices.
Gold caught between opposing forces:
Gold has seen range-trading at around $2,585 to $2,660 an ounce since mid-December, showing no convincing momentum to break out in either direction thus far. This reflects a market caught between opposing forces. On the one hand, the incoming Trump administration’s policies in the US may have an inflationary effect, casting doubt over the likelihood of future interest rate cuts by the US Federal Reserve. On the other, precious metals continue to take support from an environment of heightened geopolitical risk and policy uncertainty.
A bullish tone also came from news reports on Tuesday that China’s central bank had added to its gold reserves in December for a second consecutive month, despite the current high prices. The latest purchasing follows a six-month halt to the PBoC’s buying of gold from May to October 2024. Read More
China’s central bank purchases 10 tonnes of gold in December, analysts say it's nowhere near done buying
Chinese demand is once again revitalizing the gold market, extending a trend that began early last year.
Gold prices remain near a six-week-high, buoyed by renewed buying momentum following the People’s Bank of China’s announcement of a 10-tonne gold purchase in December. Spot gold futures recently traded at $2,647.80 per ounce, up 0.44% on the day.
This marks the second consecutive month that China’s central bank has increased its gold reserves after a six-month hiatus.
“Based on available data, the PBoC's gold reserves rose by 44 tonnes in 2024, reaching 2,280 tonnes,” said Krishan Gopaul, Senior Analyst for EMEA at the World Gold Council, in a social media post.
Investors and analysts are closely monitoring China’s central bank, as its purchases have been a critical driver of gold’s rally to consecutive all-time highs in 2024. The central bank’s robust appetite for the precious metal has also coincided with unprecedented demand among Chinese consumers, significantly outweighing weaker interest from Western investors.
“It is clear that gold ETFs have become less significant for the gold price trend. Instead, central bank gold purchases have grown much more influential over the past three years,” said Carsten Fritsch, Precious Metals Analyst at Commerzbank.
Looking ahead, analysts expect the PBoC to continue its gold acquisitions as part of their efforts to diversify away from the U.S. dollar and bolster the yuan’s international credibility. But despite the recent purchases, gold still accounts for only about 5% of China’s total foreign reserves. Read More
Gold price up but largely ignoring weak private sector employment growth
Gold prices are trading near session highs and could gain further bullish momentum as the U.S. labor market slows, following weaker-than-expected private sector growth in December, according to payroll processor ADP.
ADP reported on Wednesday that 122,000 jobs were created last month, missing expectations, as consensus forecasts had anticipated job gains of 139,000.
“The labor market downshifted to a more modest pace of growth in the final month of 2024, with a slowdown in both hiring and pay gains,” said Nela Richardson, chief economist at ADP. “Health care stood out in the second half of the year, creating more jobs than any other sector.”
Gold has been experiencing solid momentum ahead of the North American session, though it has not shown significant new movement in reaction to the disappointing labor market data. Spot gold last traded at $2,655.70 an ounce, up 0.28% on the day.
In addition to slowing employment growth, the ADP report highlighted that wage growth continues to weaken. Over the past 12 months, wages increased by 4.6%, marking the slowest pace of gains since July 2021. Meanwhile, wages for job changers rose by 7.1%, a slight decline from November. Read More
Spot gold pulls back from highs after U.S. weekly jobless claims fall to 201k
Gold prices are pulling back from session highs following the release of better-than-expected labor market data after the number of Americans filing new claims for unemployment benefits came in below economists’ forecasts.
Initial claims for state unemployment benefits fell to a seasonally adjusted 201,000 for the week ending January 4, the Labor Department announced on Wednesday. The number was below expectations, as consensus estimates forecasted a reading of 218,000 claims. The previous week’s figure was unrevised at 211,000.
The gold market was trading at session highs above $2,659 in the minutes before the 8:30 a.m. EST release, but pulled back immediately afterward. Spot gold last traded at $2,653.24 per ounce, for a gain of 0.17% on the session. Read More
Gold gains on technical buying, China demand
Gold prices are solidly higher and silver prices modestly up near midday Wednesday. Some chart-based buying is featured as February gold pushed to a three-week-high. News that China’s central bank has resumed stocking up on gold is also a bullish underlying factor for the yellow metal. February gold was last up $15.10 at $2,680.50 and March silver was up $0.119 at $30.79.
The U.S. data point of the day at mid-week is the FOMC minutes that are out this afternoon. The U.S. government and stock market are closed Thursday for former President Jimmy Carter’s national day of mourning.
In overnight news, Bloomberg reports a growing number of fund managers are warning that U.S. Treasury market repricing may have farther to go despite the Fed’s recent interest rate cuts. Options prices now suggest the potential for a rise in 10-year U.S. Treasury note yields to 5%. Meantime, China’s 10-year bonds now yield 3 percentage points less than the U.S. 10-year note. Chinese investors are moving into China’s bond market on fears of a slowing Chinese economy. The Chinese yuan continues to sell off despite China central bank intervention attempts to stabilize the Chinese currency.
Technically, February gold futures bulls have the overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $2,700.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the November low of $2,565.00. First resistance is seen at today’s high of $2,683.90 and then at $2,700.00. First support is seen at today’s low of $2,658.40 and then at $2,650.00. Wyckoff's Market Rating: 6.5.
Image Source: Kitco News
March silver futures bears have the slight overall near-term technical advantage. A nine-week-old downtrend is still in place on the daily bar chart. More gains this week would negate the downtrend, however. Silver bulls' next upside price objective is closing prices above solid technical resistance at $32.00. The next downside price objective for the bears is closing prices below solid support at the December low of $29.145. First resistance is seen at today’s high of $31.045 and then at $31.50. Next support is seen at this week’s low of $30.41 and then at $30.00. Wyckoff's Market Rating: 4.5. Read More
Image Source: Kitco News
Trump’s tariff threats are destabilizing silver markets, gold will rally again in H2 2025 – TD Securities’ Ghali
Gold will rally in the second half of the year as the Fed resumes its rate cuts, but the real story right now is the massive impact that President-elect Donald Trump’s tariff threats are having on global silver stocks, according to TD Securities’ Senior Commodity Strategist Daniel Ghali.
In a Jan. 7 interview, Ghali said that investors need to take notice of an unprecedented situation that’s unfolding in the silver market right now.
“It's hard to see it in flat prices, but over the last month there's been a huge disruption in precious metals markets where the threat of universal tariffs on metals is leading traders around the world to bring metal in from London and other global venues into the U.S., only to hedge against the risk that tariffs will be implemented on precious metals,” he said. “Historically they haven't – precious metals have been considered money in effect – but if they were to be subject to tariffs, then traders holding short positions against metal that they actually hold somewhere else in the world would be subject to substantial losses.”
“In order to hedge against that risk, they're bringing metal into the U.S.”
Ghali clarified that he’s not talking about contracts or other financial instruments, but actual, physical metal that is being brought en masse into the United States, and the implications are profound.
“This could inadvertently lead to a stock-out in the world's largest metal vaulting system for silver in London,” he said. “This is the biggest story in commodity markets right now. Silver markets seem to be just completely sleepwalking into a potential stock-out.” Read More
U.S., Perth Mints see a sharp drop in bullion demand in 2024, Royal Mint sees record Q4 sales
While Asian consumers have been purchasing physical gold at an unprecedented pace, record-high prices throughout 2024 have deterred many Western investors from entering the bullion market, according to sales data from some of the world’s largest sovereign mints.
Production data from the U.S. Mint reveals that it sold 412,000 ounces of gold in various denominations of its American Eagle gold coins. This marks a significant decline of more than 59% compared to the one million ounces sold in 2023.
Meanwhile, the U.S. Mint sold 24.862 million ounces of silver in 2024, slightly up from 24.75 million ounces sold in 2023.
Analysts note, however, that U.S. Mint production data only reflects activity in the primary market. Bullion dealers reported that the secondary market was extremely active last year as sellers sought to capitalize on higher prices.
Danielle Oliari, Chief Operating Officer of CNT Depository, commented during the London Bullion Market Association’s Precious Metals Conference that her company observed robust activity in the secondary market. She noted that due to weak mint production, the secondary supply is what helped to meet demand.
The U.S. Mint is not alone in its underwhelming sales performance. Data from the Perth Mint indicates a 41% drop in sales compared to the previous year. Australia’s sovereign mint sold 391,606 ounces of gold in 2024, representing a 65% decline from its record high achieved in 2022. Read More
Gold price holds its ground as the Fed minutes show US central bank close to a neutral rate
The gold market continues to hold its ground even as the Federal Reserve strikes a more hawkish tone due to stubborn inflation pressures, according to the minutes from the December monetary policy meeting.
Following its last meeting in 2024, the Federal Reserve cut rates by 25 basis points but signaled that it expects to cut rates only twice in 2025; in September, the central banks forecasted four rate hikes.
Although inflation pressures have eased over the past year, the minutes show that the central bank committee remains concerned about prices.
“Participants expected that inflation would continue to move toward 2 percent, although they noted that recent higher-than-expected readings on inflation, and the effects of potential changes in trade and immigration policy, suggested that the process could take longer than previously anticipated. Several observed that the disinflationary process may have stalled temporarily or noted the risk that it could,” the minutes said.
“Almost all participants judged that upside risks to the inflation outlook had increased,” the minutes added
The minutes also showed that the central bank’s is questioning how much it needs to ease as the economic activity remains relatively robust. Read More
ADP Private Sector Jobs Report Shows Lower Than Expected Growth in December
Private sector employment grew by 122,000 jobs in December, falling short of market expectations and showing a decline from November's figures, according to the latest ADP National Employment Report. The report also indicated a 4.6% year-over-year increase in annual pay.
The December job additions came in below both November's 146,000 new positions and the consensus forecast of 136,000 jobs, as reported by MarketWatch. This softer employment data could foreshadow Friday's comprehensive nonfarm payroll report, which analysts expect to show 150,000 new jobs added in December—a significant decrease from November's 227,000.
The labor market's performance remains crucial for the Federal Reserve's upcoming Federal Open Market Committee (FOMC) meeting, concluding January 29. While weaker employment data might suggest a more accommodative monetary policy stance, the CME's FedWatch tool indicates a 93.1% probability that the Fed will maintain its current funds rate between 4.25% and 4.50%. The tool also projects a 59.6% likelihood of rates remaining unchanged at the March FOMC meeting.
Market attention now shifts to Friday's U.S. Labor Department nonfarm payroll data. Three key factors will shape gold's outlook this month: Friday's jobs report, the minutes from December's FOMC meeting, and the Fed's decision on interest rates at month-end. Read More
Disclaimer: These articles are provided for informational purposes only. They are not offered or intended to be used as legal, tax, investment, financial, or any other advice.
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