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Silver Price News: Silver Shines as Dollar Dips, Rate Cuts Loom
Silver prices gained further ground on Friday, building on Thursday’s gains, as the precious metals complex saw support from a falling dollar and buoyant mood over expected interest rate cuts.
Silver prices had made modest but steady gains in the first three days of the week, but the bullish momentum went into overdrive on Thursday and Friday, with gold hitting a fresh all-time high and silver notching up a high of almost $31.00 an ounce.
The gains for silver saw the grey metal rise to its highest price since July 17 – a two-month high.
The strength for precious metals came after the European Central bank cut interest rates by 25 basis points on Thursday, serving to highlight the US Fed’s meeting on September 18 which is widely expected to see the start of a rate cutting cycle. Read More
Gold Price News: Gold Jumps Again as US Dollar Weakens
Gold prices powered up to new all-time highs on Friday, driven by a weaker US dollar and bullish sentiment linked to expected interest rate cuts.
Prices pushed up as high as $2,585 an ounce on Friday, the highest ever recorded, and building on the previous day’s gains. That compared with around $2,560 an ounce in late trades on Thursday.
The US dollar fell against other major currencies on Thursday and Friday, supporting gold, as a weaker dollar makes the yellow metal cheaper for buyers in other currencies, boosting demand.
The effect of currency movements came against a context of a loosening of monetary policy after the ECB on Thursday cut interest rates for the second time in three months. The US Fed is expected to follow suit at a meeting scheduled for September 18, with expectations mixed over whether the bank will cut rates by 25 or 50 basis points. Read More
Gold price see some technical selling pressure as New York Fed Survey jumps to 11.5
Gold prices are holding support above $2,600 an ounce but could face some technical selling pressure as the New York Federal Reserve reports robust growth in the region’s manufacturing sector.
On Monday, the regional central bank said its Empire State Manufacturing Survey rose to 11.5, up sharply from August’s reading of -4.7. The data was significantly better than expected, as economists had anticipated a roughly unchanged reading.
"New York State manufacturing activity in September grew for the first time in nearly a year, with shipments increasing strongly. However, employment continued to decline modestly. Firms became more optimistic that conditions would improve in the months ahead, though capital spending plans were weak," said Richard Deitz, Economic Research Advisor at the New York Fed, in the report.
The gold market is experiencing some selling pressure in neutral territory in its initial reaction to the economic data. December gold futures last traded at $2,607.80 an ounce, down 0.15% on the day. Read More
Gold prices will gain in Q4 on Fed cuts, election risk, Chinese rebound, silver sees massive support from India – Heraeus
Gold is set to benefit from several tailwinds in Q4, including this week’s expected Fed rate cut, continued central bank purchases, and a rebound in Chinese demand, while silver prices will gain on standout Indian demand and a weaker USD, according to precious metals analysts at Heraeus.
In their latest precious metals report, Heraeus noted that the kickoff of the Fed’s rate-cutting cycle on Wednesday should be good for gold, even if it’s only a 25 bps cut.
“The probability that the Fed will cut interest rates by 50bp this week, as assessed by the swaps market, fell to 13%; down from 40% last week, before seeing a resurgence in dovish bets on Friday which took the probability to 43%,” the analysts wrote. “This comes as the ECB cut by 25bp for a second time last Thursday adding to transatlantic interest rate differentials.”
“A 50bp cut to the federal funds rate would likely give gold a bigger boost, but either way, a lower interest rate environment tends to be positive for gold as the dollar is expected to weaken and the opportunity cost of holding gold as a non-yielding asset falls,” they added. “If the Fed ends up cutting more than expected at the next few meetings, the upside for the gold price could be magnified.” Read More
Silver price will move higher in 2025 but will remain in gold’s shadow - Capital Economics
The gold market continues to hit new highs, with prices pushing above $2,600 an ounce. Silver is being swept up in the new momentum, but one research firm expects it will remain in gold’s shadow.
Last week, gold made another unprecedented run to a new record high, rallying over 3%; however, silver saw an even bigger surge, jumping 10% as prices pushed above $31 an ounce.
Although silver experienced a significant move last week, its broader price action compared to gold remains relatively muted. The gold/silver ratio has managed to hold support above 83 points, well above the May low of 72.67 points.
December silver futures last traded at $31.010 an ounce, down 0.24% on the day. Silver’s rally back above $31 has pushed prices up 23% so far this year. Meanwhile, December gold futures last traded at $2,607.40 an ounce, down 0.13% on the day. Year-to-date, gold prices are up nearly 26%.
In a report published last week, commodity analysts at Capital Economics said they were in the process of upgrading their silver price forecast, but they warned that it won’t match their bullish outlook on gold. Read More
Gold edges to new record high then pauses ahead of FOMC
Gold prices are near steady in midday U.S. trading after poking to another record high of $2,617.40, basis Comex December futures, overnight. Silver prices are also near unchanged as both markets are pausing ahead of a big U.S. data week. December gold was last down $1.20 at $2,609.40 and December silver was up $0.016 at $31.085.
The U.S. data point of the week is the Federal Reserve’s Open Market Committee meeting (FOMC) that begins Tuesday morning and ends Wednesday afternoon with a statement and press conference from Fed Chairman Jerome Powell. The marketplace thinking has shifted just recently, now slightly favoring a 0.5% rate cut, after earlier reckoning a 0.25% rate cut was most likely. Reads a Wall Street Journal headline today: “Stock markets now need a bigger Fed rate cut; anything less would hurt.”
Technically, December gold bulls have the strong 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 $2,500.00. First resistance is seen at the overnight record high of $2,617.40 and then at $2,625.00. First support is seen at last Friday’s low of $2,585.00 and then at $2,570.40. Wyckoff's Market Rating: 9.5.
Image Source: Kitco News
December silver futures bulls have the overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the July high of $32.46. The next downside price objective for the bears is closing prices below solid support at $29.00. First resistance is seen at the overnight high of $31.46 and then at $32.00. Next support is seen at $30.67 and then at $30.00. Wyckoff's Market Rating: 6.5. Read More
Image Source: Kitco News
Gold to average $2,800/oz by 2025, now represents 100% of commodity allocation – SocGen
Gold stands alone in the entire commodity sector, according to analysts at Societe Generale, and the yellow metal now represents 100% of their commodity allocation.
“Buoyed by geopolitical uncertainty and a moderating inflation environment in the US, as well as a potential convergence of fiscal costs whoever wins the US presidential election, gold has continued its march higher since our analysts' last quarterly,” analysts noted in the French bank’s latest commodities outlook. “The question now is where we go from here.”
The SocGen analysts list “five major themes” that they believe are likely to drive gold markets: “geopolitics, the dollar and rates, central bank purchases, investor flows and fundamentals.” But they warn that while each of these drivers is “overwhelmingly positive” for gold prices, “there is a notable absence of unpriced drivers higher.”
“The Fed’s policy reversal, with its likely effect on rates and the dollar, has been widely choreographed, and geopolitical tensions in the Middle East, as well as persisting tensions between the US and China, have also been on the horizon for a while,” they explained. “Fundamentals, geopolitics, rates and the USD as well as continued central bank purchases are all supportive of further gains. However, possible catalysts remain diffuse: ‘Goldi’ without the ‘locks.’” Read More
A decade-long commodity supercycle is just getting started – analysts
During periods of easy money, risk assets like stocks tend to outperform as investors chase gains, but during times of economic strife, commodities become the safe haven for many investors. According to one analyst, now is the time to prepare for a commodity supercycle.
“The last [two] times we saw these valuations for commodities was 1971 and 2000,” tweeted MN Consultancy founder Michaël van de Poppe. “Commodities & #Crypto are extremely undervalued and it's likely that commodities go into a 10-year long bull market.”
“I'm expecting a lot of upside from these two asset classes,” Poppe said.
As shown in the image above, commodities are currently valued at levels lower than in the lead-up to the dot-com bubble of 2000 and the 2008 financial crisis, and if history is any guide, they could soon rapidly catch up to the field as investors rotate out of an overheated stock market.
Analysts at Bank of America have a similar outlook as Poppe, saying that a secular bull run in commodities is just starting and suggesting that investors should consider allocating to commodities instead of bonds in a 60/40 investment portfolio.
According to a recent “Flow Show” note from BofA Investment Strategist Jared Woodard, a “commodity secular bull market in the 2020s is just getting started as debt, deficits, demographics, reverse-globalization, AI & net-zero policies all inflationary.” Read More
Live From The Vault - Episode: 190. “Gold is going higher” Feat. Dave Kranzler
In this week’s episode of Live from the Vault, Andrew Maguire welcomes back hedge fund manager and Mining Stock Journal author, Dave Kranzler, to delve into market manipulation and its impact on gold and silver prices.
The precious metals experts kick off with Dave providing an overview of the US economy and potential impending rate cuts, before exploring endgame scenarios for commercial real estate and central bank gold buying.
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.
Featured Image - Source: Unsplash
