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Gold Price News: Gold Hits All-Time High as Mid-East Tensions Soar
Gold prices powered up to another all-time high on Tuesday, driven by ongoing economic and geopolitical uncertainty and a weaker US dollar. Prices rallied as high as $3,038 an ounce on Tuesday – their highest ever intraday price – up from around $3,000 an ounce in late trades on Monday.
Geopolitical tensions support safe havens:
Gold’s safe-haven value continues to attract buyers due to the current climate of geopolitical and economic uncertainty. Israel launched fresh strikes against what it said were Hamas targets in Gaza overnight, which reportedly killed more than 400 people. Talks to extend a ceasefire which started in January have not yet found agreement. Meanwhile, Germany has moved to exempt military spending from rules that aim to limit the country’s debt, in a sign that Europe is beginning to ramp up its defence capability in the context of Russia’s February 2022 invasion of Ukraine and signs of declining US interest in providing military assistance to Europe.
The ongoing conflicts in the Middle East and Europe represent risk elements that support precious metals prices, and this factor is only compounded by economic uncertainties linked to recent US trade policies.
Weaker US dollar lifts gold:
The US dollar fell in value against other major currencies in the first half of March and continued to trade at fresh four-month lows against the euro on Tuesday. A weaker dollar tends to support dollar-denominated gold prices as it makes the precious metal more affordable for buyers in other currencies. Read More
Silver Price News: Silver Climbs as Gold Hits All-Time High
Silver prices firmed slightly on Tuesday, as precious metals continued to draw interest due to heightened economic and geopolitical tensions.
Prices briefly rose as high as $34.43 an ounce on Tuesday, although the market eased back later to trade at $34.08 an ounce later in the evening. That compared with around $33.96 an ounce in late trades on Monday.
Gold’s gains drag silver higher:
The latest gains for silver came as gold prices hit a fresh all-time high of well over $3,000 an ounce amid further flare-ups in hostilities in the Middle East. Israel launched strikes in Gaza that killed hundreds of people overnight Monday, leading to fresh doubts over the peace process. The conflict continues to carry the risk of drawing in larger countries, which in turn has driven investment into safe-haven assets like gold and silver.
A weaker US dollar on Tuesday also contributed to support for dollar-denominated gold and silver prices. Recent market chatter has centred around the risks of a possible US recession, and while such an outcome could curb industrial consumption of silver in the US, it has also helped to divert investment flows into more secure assets such as precious metals.
Worries over possible US trade tariffs on physical gold and silver imports have prompted a transfer of bullion from London to the US, according to news reports. Read More
Is the US dollar destined for further downside?
The US dollar's recent rally amid concerns about Trump's trade wars and the Fed's potentially hawkish stance was short-lived. Since the end of January, the Dollar Index has fallen more than 4%, and major investment firms have actively revised their forecasts for its future. What exactly is going on?
The idea prevails that the DXY reflects patterns observed during Trump's first term, but the movements seem more driven by news events, such as fears that U.S. protectionist policies could hurt the U.S. economy. Indeed, the Atlanta Fed's estimate for real GDP growth in the first quarter already stands at -2.4%.
The good news is that amidst this economic gloom, there is a silver lining. Suppose the economic situation continues to deteriorate, and the threat of recession looms. In that case, the Fed may be forced to soften its rhetoric — albeit reluctantly — as inflation could still rise due to ongoing trade wars.
Regarding price developments, in February, the Consumer Price Index registered a month-on-month growth of only 0.2%, with a year-on-year growth rate of 2.8%. Meanwhile, the core inflation rate also came in at 0.2% month-on-month and 3.1% year-on-year, slightly above market expectations.
The problem is inflation expectations for next year have risen to 4.9%, marking the highest level since 2022 and representing the third consecutive month of increases. Inflation expectations for the next five years have also jumped by 0.4 percentage points, reaching the highest 3.9% since 1993. Read More
Gold and the OECD Economic Outlook: Trade wars to cut growth, raise inflation, and complicate rate path
The OECD's March 2025 Interim Economic Outlook reveals a global economy at a critical juncture, with trade-driven inflation pressures and growth deceleration generating tailwinds for gold prices even as they create policy dilemmas for central banks.
"The global economy has shown some real resilience,” Secretary-General Mathias Cormann said. “However, some signs of weakness have emerged, driven by heightened policy uncertainty.”
The OECD projects global growth will slow to 3.1% in 2025, a downgrade from December's 3.3% forecast, and 3.0% in 2026, citing "heightened policy uncertainty" and "increasing trade restrictions [that] will contribute to higher costs both for production and consumption.” These tariffs threaten to reduce U.S. growth to 2.2% in 2025 and 1.6% in 2026, while Canada would see only 0.7% GDP expansion this year - a 1.3 percentage point cut from the prior 2% estimate.
The report also revises G20 inflation forecasts upward to 3.8% in 2025 and 3.2% in 2026 – a +0.3% increase from the December projections – noting that “services price inflation is still elevated amidst tight labour markets,” while core inflation in some advanced economies is projected to “exceed central bank targets... by 2026.” Read More
Gold has room to run but could pull back if a recession hits - Capitallight’s Schieven
The gold market has seen a solid break above $3,000, and although it is experiencing strong momentum, one market analyst is not yet ready to change her forecast, as higher prices could have an unexpected impact on the precious metal.
In a recent interview with Kitco News, Chantelle Schieven, Head of Research at Capitalight Research, said she is maintaining her initial forecast for gold to reach a high-water mark of $3,200 an ounce this year. However, she added that despite potential volatility, the precious metal remains in a solid uptrend.
“I think we get above gold’s inflation-adjusted highs, but I don’t see that happening this year,” she said.
Schieven noted that gold’s inflation-adjusted all-time high, dating back to January 1980, is around $3,400 an ounce.
Although Schieven is bullish on gold this year, she said it is difficult to predict how a recession will impact the precious metal. She explained that during economic downturns, investors often sell gold to raise capital and cover equity losses.
Gold prices are now up more than 15% so far this year. At the same time, the S&P 500 has declined nearly 5% year-to-date. The broader equity market index is down 8.5% from its all-time high last month.
Schieven expects the global economy to continue struggling in response to President Donald Trump’s ongoing support of America-first policies, including tariffs on imported goods, which have fueled a global trade war. Read More
Gold rally dynamics have shifted again, currency depreciation is now the main driver – TD Securities’ Ghali
While central banks were the major buyers behind gold’s rally last year, the main driver has now switched to currency depreciation and risk-off sentiment, according to Daniel Ghali, senior commodity strategist at TD Securities.
“Central bank buying activity in gold has been a secular trend,” Ghali said. “Since 2010, I'd say, the breadth of central banks buying gold has started to increase. And the fact of the matter is, there's a really wide variation as to why these central banks are buying it.”
He listed as examples the de-dollarization trend that has become stronger since the sanctions against Russia, and other countries looking to partially diversify away from the U.S. dollar. “But I actually think that what's been more relevant in that stream of buying activity in gold this year has been buying gold as a currency depreciation hedge,” he said.
“We actually started off the year with a pretty stellar rally in the U.S. dollar,” Ghali noted. “This is very counterintuitive, but if you're a country who wishes to diversify away from the U.S. dollar, you might take advantage of those moments in time when the U.S. dollar is pretty strong in order to sell U.S.-dollar-denominated assets and buy non-U. S.-dollar-denominated assets, one of which is gold.”
“That currency depreciation pressure is really what, counterintuitively, has been fueling central bank buying activity in gold this year.”
But the greenback has since slid in value – along with U.S. equity markets – and this has changed the drivers of the gold rally once again. “Over the last few weeks, the dollar has weakened substantially, so we think this ‘mystery buying activity,’ which we've dubbed it, has stepped away.” Read More
New Utah law allows state vendors to be paid in gold and silver
Gold and silver continue to play important roles as monetary assets in global financial markets, and now the state of Utah is embracing precious metals as local currency.
On Tuesday, the state legislature passed a bill allowing government vendors to choose to be paid in gold and silver for the first time in America.
Bill HB306, now awaiting signature from Governor Spencer Cox, authorizes the state treasurer to issue a competitive procurement for a precious metals-backed electronic payment platform. This will allow state vendors to opt for payment in physical gold and silver.
Rep. Kenneth Ivory sponsored Bill HB306, and Sen. Keith Grover pushed the legislation through the Senate. The state politicians noted that the legislation is the latest evolution in Utah’s stance in favor of sound money. In 2011, Utah became the first state to recognize gold and silver as legal tender. Now, an electronic payment system will create more flexibility by fractionalizing physical silver and gold.
“In uncertain economic times, Utah is providing vendors and service providers with the option to receive payment in gold and silver,” Rep. Ivory said. “This law gives Utahns an alternative to choose how they preserve the purchasing power of their earnings and savings.” Read More
Gold sees slight bounce as Fed makes no rate change, as expected
Gold prices are just a bit higher early afternoon U.S. trading Wednesday, in the immediate aftermath of the Federal Reserve’s FOMC policy statement that contained no big surprises. Silver futures are solidly down on profit taking by the shorter-term futures traders after recent gains. April gold was last up $4.10 at $3,045.00. May silver prices were last down $0.508 at $34.30.
The U.S. data point of the week saw the Federal Reserve Open Market Committee (FOMC) meeting statement show no interest rate change, which was expected by the marketplace. The statement said the U.S. economic outlook is uncertain at present and that inflation remains somewhat elevated. The statement said the Fed will also slow the runoff of its assets, which is, in effect, a slight monetary-policy-easing move. Gold traders breathed a sigh of relief the FOMC statement did not lean hawkish. Traders were awaiting Fed Chair Powell’s press conference.
Broker SP Angel today said in an email dispatch: “Gold continues to enter the mainstream, with fund managers boosting their allocations, seen in the jump in ETF holdings by 5% over the past 12 months. We would note that ETF holdings remain well below COVID levels, leaving ample room for further rallies as speculators enter the market.”
Technically, April gold futures bulls have the strong overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at $3,100.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,900.00. First resistance is seen at the contract high of $3,052.40 and then at $3,065.00. First support is seen at the overnight low of $3,031.30 and then at Tuesday’s low of $3,008.20. Wyckoff's Market Rating: 9.5.
Image Source: Kitco News
May silver futures bulls have the firm overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at the October 2024 high of $35.80. The next downside price objective for the bears is closing prices below solid support at $32.215. First resistance is seen at this week’s high of $35.00 and then at $35.50. Next support is seen at the overnight low of $34.27 and then at $34.00. Wyckoff's Market Rating: 7.0. Read More
Image Source: Kitco News
Gold prices hold near record highs as Fed maintains cautious stance on rate cuts
The gold market remains off its highs and is struggling for direction as the Federal Reserve maintains its neutral monetary policy stance, even as it raises its inflation expectations and lowers its growth forecast.
As expected, the Federal Reserve left interest rates unchanged within a range of 4.25% to 4.50%. The U.S. central bank provided little guidance on its monetary policy. According to updated interest rate projections, also known as the dot plots, the Federal Reserve sees interest rates ending the year at 3.9%, unchanged from December. The central bank also expects rates to fall to 3.4% next year and 3.1% in 2027, maintaining its previous projections.
While the Federal Reserve is in no hurry to cut interest rates, it is taking a more nuanced stance regarding its balance sheet.
“Beginning in April, the Committee will slow the pace of decline of its securities holdings by reducing the monthly redemption cap on Treasury securities from $25 billion to $5 billion. The Committee will maintain the monthly redemption cap on agency debt and agency mortgage-backed securities at $35 billion,” the central bank said in its monetary policy statement.
The gold market is not seeing any new momentum, even as prices continue to trade near record session highs above $3,000 an ounce. Spot gold last traded at $3,031.16, roughly unchanged on the day. Read More
‘We know tariffs are coming in, and all forecasters have tariff inflation affecting core CPI inflation’ – Fed Chair Powell
Following the Federal Reserve’s decision to keep interest rates unchanged as expected, FOMC Chair Jerome Powell’s press conference focused on the Trump administration’s tariffs: How much they were baked into the latest Fed projections, what impact they’d already had, and how likely they were to raise inflation, lower growth, hurt employment, and impact interest rates – or even send the U.S. economy into recession.
The first question directly addressed the degree to which Trump’s trade tariffs had already changed the economic environment. Powell set the tone for the conversation early, insisting that the situation was above all uncertain.
“It is going to be very difficult to have a precise assessment of how much of inflation is coming from tariffs,” he said. “You may have seen that goods inflation moved up pretty significantly in the first two months of the year. Trying to track that back to actual tariff increases, what was tariff and what was not, very, very challenging.”
“The answer is clearly some of it – a good part of it – is coming from tariffs,” he conceded. “But we will be working, and so will other forecasters, to try to find the best possible way to separate nontariff inflation from tariff inflation.” Read More
Gold soars to new all-time record as Fed holds rates steady amid trade tensions
Gold prices climbed to unprecedented heights Wednesday, closing at a record $3,047.14 after the Federal Reserve concluded its March Federal Open Market Committee (FOMC) meeting with a decision to maintain current interest rates.
The precious metal gained $13.03 (0.43%) in New York trading before advancing further in the Australian market, adding another $3.05 to reach $3,050.23. Based on settlement prices, April gold futures recorded even stronger performance, gaining $15.80 to close at $3,057.50.
Image Source: Kitco News
These gains came despite a strengthening dollar, which rose 0.18% to 103.10 on the dollar index, demonstrating gold's current robust momentum. According to market analysts, this upward trajectory reflects growing investor concern about economic stability and inflation risks.
"Today's gains in gold completely overcame fractional gains in the U.S. dollar," noted a senior market strategist familiar with the movements. "This suggests strong underlying demand for safe-haven assets."
Fed Decision and Economic Outlook:
The Federal Reserve unanimously voted to maintain its benchmark "Fed funds" interest rates between 4.25% and 4.50%, while also deciding to slow the pace at which it reduces assets from its balance sheet.
However, in their post-meeting statement, Fed officials expressed expectations for slower economic growth coupled with rising inflation pressures. They specifically highlighted concerns regarding the Trump administration's trade policies, describing them as "ambitious and frequently erratic" and concluding that these policies have placed both the economy and the Federal Reserve's ability to maintain stability "under increasing pressure." 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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