x
Image Source: Unsplash
Silver Price News: Silver Edges Higher Awaiting Manufacturing Data
Silver prices ticked higher on Tuesday, managing to gain around 0.5% day-on-day in largely lacklustre trading.
Prices rose to around $29.30 an ounce by Tuesday evening, compared with around $29.07 an ounce in late trades on Monday.
The relative stability mirrored the price action in gold, which similarly saw mostly sideways trading on Monday and Tuesday following fresh all-time highs in the middle of last week.
Silver prices traded well above $31.00 an ounce last week, and following a sharp drop since then, the market has moved a few cents either side of $29.00 an ounce. This was a level that previously saw strong buying in June, making it a key area for traders to watch going forward.
Of interest to both gold and silver markets, India has slashed its customs duties on gold and silver to 6%, and platinum to 6.4%, according to the country’s latest budget. The move is aimed to discourage illegal smuggling of precious metals, but is also expected to boost demand among retail buyers, who will now be able to bring the metals in at a lower cost. Read More
Gold Price News: Gold Range Bound In Calm Conditions
Gold prices were little changed overall on Tuesday, with the markets seemingly in wait-and-see mode amid a lack of fresh drivers.
Prices moved in a range of $2,389 to $2,412 an ounce on Tuesday, just within the previous day’s range of $2,385 to $2,412 an ounce.
The more stable conditions stood in contrast to the volatility seen in the week ending July 19, which saw prices slump for three consecutive days after hitting fresh all-time highs of over $2,484 an ounce on July 17.
A lack of influential macroeconomic data at the start of the week gave gold traders little to go on for direction, leaving markets looking ahead to Wednesday’s monthly manufacturing data from several countries including India, France, Germany, UK and the US. Then on Thursday, the markets will get an update on the US economy with GDP figures for Q2.
In the exchange market, open interest on gold futures contracts increased for a fourth consecutive week in the week to July 19, according to World Gold Council data: Gold Open Interest Chart 2021 | World Gold Council. Moreover, gold net long positions on the Comex increased by 13% to 897 tonnes in the week to July 16, from 794 tonnes the previous week, the figures showed. Read More
Gold price holding steady gains against the Canadian dollar as BoC cuts rates by 25 basis points
The gold market is holding its own as waning inflation pressures have given the Bank of Canada room to ease interest rates further.
Wednesday, in a much-anticipated move, the BoC lowered its target for the overnight rate to 4.50%, with the Bank Rate at 4.75% and the deposit rate at 4.50%.
The expected rate cut is not having much impact on the gold market as it maintains its price gains against the Canadian dollar. Spot gold last traded at $3,343,85 an ounce, up 0.71% on the day.
Gold’s move against the Canadian dollar is roughly in line with its performance within the broader market. Spot gold against the U.S. dollar last traded at $2,425.501 an ounce, up 0.69% on the day. Read More
The Federal Reserve's limited control over inflation is becoming evident- Dr. Nomi Prins
The Federal Reserve's ability to manage inflation effectively is increasingly being questioned. Despite persistent rate hikes, inflation remains resilient, and the central bank appears powerless against the larger economic forces at play.
In a recent interview with Jeremy Szafron, Anchor at Kitco News, Dr. Nomi Prins, economist and author, provided critical insights into the Federal Reserve's handling of inflation and its broader economic impacts.
"The Fed cannot control inflation, and if it's going to be above 2%, a little bit below, at 3%, at 4%, at any given point in time, they really can't do anything about supply and demand, geopolitical events, or anything else that drives inflation," she stated.
This assessment highlights a growing concern among economists about the Fed's current strategies. According to recent data from the U.S. Bureau of Labor Statistics, inflation rates have been fluctuating, with a current rate of 3.0% as of June 2024. Watch the interview
Spot gold holds above $2,420 as U.S. flash PMI shows improvement in services, contraction in manufacturing,
The gold market is holding in positive territory on the session after the latest data showed improvement in the U.S. service sector, but a decline into contractionary territory for manufacturing this month.
S&P Global announced on Wednesday that its flash Purchasing Managers Index for the service sector rose to 56 in July, up from June’s reading of 55.3. Activity in the service sector was stronger than expected, as economists forecasted a reading of 54.4.
Activity in the manufacturing sector declined, however, falling to 49.5 from June’s reading of 51.6. Economists were expecting a slight improvement to 51.7.
The gold market whipsawed in the minutes following the 9:45 am EDT release, but spot gold is managing to hold onto its earlier gains. Read More
In a polarized world, gold will be well-supported no matter who wins the U.S. Presidency - World Gold Council
The WGC noted that historically, physical gold demand tends to increase when a Democrat President is in power. However, they don’t see any statistically significant advantage from one party to the other.
“Overall, our analysis of gold and US presidential elections suggests that gold is not reacting directly to party affiliation or changes in leadership. Rather, it highlights the relevance of key global macroeconomic drivers of gold’s performance in contrast to specific local dynamics,” the analysts said.
The WGC noted that gold has done well during both the Trump and Biden administrations, and there is no reason to assume that this trend won’t continue with new leadership. Read More
Gold rallies on bullish outside-market forces
Gold prices are trading double-digits higher and silver slightly up in midday U.S. trading Wednesday. Bullish daily “outside-market” forces are boosting buying interest in the precious metals: a lower U.S. dollar index, sharply lower U.S. stock index prices, and higher crude oil prices. U.S. Treasury yields have also stabilized this week, which also leans a bit friendly for the precious metals market bulls. August gold was last up $14.80 at $2,422.00. September silver was up $0.064 at $29.39.
U.S. stock indexes are sharply lower at midday and hit five-week lows. Downbeat earnings reports from Tesla and Alphabet are weighing heavily on stock trader/investor sentiment at mid-week. Significant near-term technical damage has been inflicted on the stock indexes to suggest market tops are in place for the indexes. That’s a significantly bullish development for the precious metals markets, as the stock market is a competing asset class for the safe-haven gold and silver markets.
Technically, August gold bulls still have the firm overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the record high of $2,488.40. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $2,300.00. First resistance is seen at today’s high of $2,433.00 and then at $2,450.00. First support is seen at today’s low of $2,405.70 and then at $2,400.00. Wyckoff's Market Rating: 7.5.
Image Source: Kitco News
September silver futures bulls have the slight overall near-term technical advantage but have faded badly recently. Silver bulls' next upside price objective is closing prices above solid technical resistance at $31.00. The next downside price objective for the bears is closing prices below solid support at $28.00. First resistance is seen at today’s high of $29.63 and then at $30.00. Next support is seen at the overnight low of $29.235 and then at this week’s low of $28.825. Wyckoff's Market Rating: 5.5. Read More
Image Source: Kitco News
BRICS+ is driving the new gold rush, China-Russia gold-backed currency would mark ‘beginning of the end’ of fiat – Swissgrams’ Vahan Roth
Central banks in BRICS+ and neutral countries are purchasing gold at an unprecedented rate, while political instability, inflation, and U.S. dollar weaponization are also bolstering gold’s appeal, according to Vahan Roth, executive director of gold tokenization firm Swissgrams AG.
In an analysis for intelligence consultancy GIS published Wednesday, Roth noted that gold’s surge to a new all-time high of $2,480 per ounce on July 17 underscores strategic moves by central banks in BRICS+ and other countries against a backdrop of geopolitical and economic uncertainty.
“This is a significant jump from its previous record of $2,075, set in August 2020, amid the pandemic-induced uncertainty and consequent safe-haven demand,” he wrote.
Roth said the runup in price is not surprising given the ongoing geopolitical turbulence. “There are two active wars – in Ukraine and the Middle East – and either (or both) could escalate at any moment into a wider international conflict,” he said. “Meanwhile, immensely influential elections are taking place this year: in India, the United Kingdom and the European Union incumbents lost clout, Mexico has a new leader with the same leftist program, and the unpredictable November presidential election in the United States is drawing closer.”
“Sociopolitical tensions, deep ideological divisions and dangerous polarization are becoming the norm worldwide.” Read More
Economic Data Poised to Shape Fed Decision and Market Outlook
Investors are pricing in multiple scenarios for potential rate cuts in September. The CME's FedWatch tool indicates an 89.6% probability of a 0.25% rate cut, a 10.2% chance of a 0.50% cut, and a newly added 0.3% possibility of a 0.75% cut. This last scenario would bring the Fed funds rate down to between 4.50% and 4.75%, signaling a significant shift in monetary policy.
Daily gold chart
Image Source: Kitco News
The anticipation of these reports and their potential impact on Fed decisions has already influenced financial markets. Gold futures, often seen as a hedge against economic uncertainty, have shown volatility. The most active August contract opened at $2,410.70, and reached a high of $2,433, before settling near the day's low at $2,397.
As market participants and policymakers alike await these critical economic indicators, the coming days promise to be pivotal for the U.S. economic outlook. The interplay between GDP growth, inflation trends, and the Fed's response will likely set the tone for financial markets in the months ahead. 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.
