Today's Gold and Silver News: 15-12-2022

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Gold Price News: CPI Below Expectations Pulls Gold Above $1,800

The gold price has reacted positively to the latest US inflation figures, which again came in below analyst expectations.

The bullion price jumped above $1,800 an ounce after the CPI posted the smallest monthly increase in over a year, confirming that the US inflation rally is continuing to slow down. Prices have risen by only 0.2% in November, while the YoY data was just above 7% (0.2% below expectations).

In other words, it looks increasingly likely that the worst of inflation has passed with the tightening process of the last 12 months delivering results and reducing the hawkish pressure on the Federal Reserve.

Stock markets and gold reacted by again moving in the same direction, with significant gains for both (later partially reabsorbed by the markets). Focusing on gold, the bullion price accelerated just after the release of the data, reaching a top at $1,840, before consolidating to the $1,820-$1,830 area. Read More

Silver Price News: Silver Jumps Above $24 After Positive US Inflation Data

The silver price jumped above the $24 threshold for the first time since April 25^th after the US inflation reading came in below forecast and pushed investors into continuing buying the precious metal.

Indeed, excluding food and energy, CPI increased by a tiny 0.2% and this data was seen by the markets as a confirmation that inflation has already reached a peak.

In this scenario, silver confirmed its solid momentum, as investors are still accumulating the precious metal. From a technical perspective, silver remains in a positive uptrend, with the resistance levels at $24.40 per ounce (yesterday’s top), $24.70 and $25.40.

The peaks reached in the spring between $26.50 and $27.50 per ounce are still far away, but silver is continuing to show strength and these levels could be seen as a medium-term target, particularly if the US Dollar continues to weaken. Read More

This is what Jeffrey Gundlach is watching in the gold price

Billionaire "Bond King" Jeffrey Gundlach said gold had performed well this year, and now it needs to cross the 200-day moving average on a weekly basis to send a much more bullish signal.

"Gold [has] done pretty well this year. We were looking at it in dollar terms, and the dollar is still up pretty substantially this year, although it is off its highs. But gold appears to be stabilizing around its 200-day moving average," DoubleLine Capital CEO Gundlach said during a webcast that aired last week.

Gold crossed the 200-day moving average Tuesday, but for it to really make a difference, the precious metal needs to have a weekly close above that level, according to Gundlach. The 200-day moving average is around $1,821 an ounce. And on Tuesday, February Comex gold futures were last trading at $1,823.10, up 1.72% on the day.

"Moving above the 200-day moving average would be pretty interesting. We would want to see a weekly close, not just a day," Gundlach said.

DoubleLine Capital CEO pointed to gold's predictive behaviour when explaining why gold is starting to move up. "Maybe this is predictive, looking forward to a weaker dollar … Dollar has peaked out," he said. Read More

Fed's rate hike slowdown or potential 2023 cuts back gold price rally - ING

Gold is up nearly 8% in the last three months as markets are counting on the Federal Reserve to slow down its rate hike pace as inflation starts to cool. And this time around, the rally could take off, according to ING.

The precious metal crossed its 200-day moving average and climbed to nearly a six-month high of above $1,836 an ounce Tuesday. At the time of writing, February Comex gold futures were last trading at $1,823.40, down 0.12% on the day.

"On Tuesday, gold jumped to its highest price since June after U.S. consumer prices posted the smallest monthly gain in more than a year, sparking hopes that the U.S. Federal Reserve will ease the pace of interest rate hikes," said ING's head of commodities strategy Warren Patterson and commodities strategist Ewa Manthey.

Inflation surprised Tuesday, with the annual CPI print coming in at 7.1% in November after registering 7.7% in October. 

If inflation is continuously coming down, this gives the Fed the reason to take a step back from its aggressive tightening pace. And a more reasonable Fed could mean a lower U.S. dollar and a significant boost for gold.

"Whilst inflation is still higher than the Fed's comfortable range, softening of inflation reinforces the view that the peak of the rate-hike cycle might be in sight," the strategists said. "A slowdown in rate hikes could increase the investment appeal of gold in the longer term." Read More

Downside risks for gold and silver prices in 2023 - Natixis' Dahdah

While the world will see slower growth and higher inflation, it may not be the best environment for gold, according to one precious metals analyst.

In an interview with Kitco News, Bernard Dahdah, precious metals analyst at Natixis, said that he sees more downside risk to gold and silver than on the upside in 2023.

He explained that the precious metal could continue to struggle to attract investor attention in the new year as he expects real rates to remain positive.

In its 2023 economic outlook, the French bank said there is no doubt that there will be a recession in 2023; however, the economists expect a mild retraction with growth bouncing back in 2024.

"We are staring at a big slowdown in growth, but then inflation should follow. Key rates at the world's central banks are close to their terminal levels (after peaks in H1, the next moves could be mostly on the downside, at least in 2024). Winter is coming but that's normal, spring will come too," the economists wrote in their 2023 outlook report. Read More

Gold price weakens as FOMC still leaning hawkish

Gold and silver prices are lower in early-afternoon U.S. trading Wednesday, and extended mild earlier losses after the Federal Reserve raised U.S. interest rates and said more rate hikes are coming. February gold was last down $12.00 at $1,812.80 and March silver was down $0.145 at $23.83.

The just-released Federal Reserve’s Open Market Committee (FOMC) meeting statement saw the U.S. central bank raise its key Fed funds rate by 0.5%, as expected. The Fed said it will continue to tighten monetary to tamp down inflation. The marketplace’s initial read on the statement and the economic projections is a bit more hawkish than many expected. Traders are now awaiting a press conference from Fed Chair Jerome Powell. The European Central Bank and the Bank of England meet on Thursday and are likely to follow the U.S. Federal Reserve with half-point rate hikes.

Technically, February gold prices hit a 5.5-month high Tuesday. The gold futures bulls have the firm overall near-term technical advantage. Prices are in a five-week-old uptrend on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $1,900.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,775.00. First resistance is seen at today’s high of $1,824.70 and then at this week’s high of $1,836.90. First support is seen at $1,800.00 and then at this week’s low of $1,789.00. Wyckoff's Market Rating: 7.0

Image Source: Kitco News

March silver futures prices hit a seven-month high Tuesday. The silver bulls have the solid overall near-term technical advantage. Prices are in a choppy 3.5-month-old uptrend on the daily bar chart. Silver bulls' next upside price objective is closing prices above solid technical resistance at $25.00. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at this week’s high of $24.39 and then at $24.75. Next support is seen at this week’s low of $23.32 and then at $23.00. Wyckoff's Market Rating: 7.0. Read More

Image Source: Kitco News

Gold prices continue to hold support above $1,800 as Fed raises rates 50bps and sees a terminal rate above 5% in 2023

The gold market is seeing one technical selling pressure but continues to hold support above $1,800 an ounce as the Federal Reserve looks to raise the terminal rate to above 5% in 2023.

Wednesday, as expected, the Federal Reserve raised interest rates by 50 basis points to between 4.25% and 4.50%. Although the pace of rate hikes has slowed, the central bank said that it continues to see more tightening into 2023.

"The Committee anticipates that ongoing increases in the target range will be appropriate in order to attain a stance of monetary policy that is sufficiently restrictive to return inflation to 2 percent over time. In determining the pace of future increases in the target range, the Committee will take into account the cumulative tightening of monetary policy, the lags with which monetary policy affects economic activity and inflation, and economic and financial developments," the central bank said in its monetary policy statement.

The latest economic projections, also known as the "dot plot," indicates that the central bank sees the Fed Funds rate rising to 5.1% next year, up from September's projection of 4.6%. Read More

Tough talk by Chairman Powell signalling more rate hikes over a longer time span

As expected, the Fed announced its decision to raise its benchmark rate by 50-bps. This takes the central bank’s “Fed funds” rate to between 425 - 450 bps (4 ¼% - 4 ½%). However, it was Chairman Powell’s comments regarding his policy outlook during the press conference that garnered the most attention. Market participants and analysts were looking for insight into the forward guidance of the Federal Reserve as it pertains to their monetary policy, inflation, and future rate hikes. Which revealed that the Federal Reserve will continue its policy of monetary tightening by continuing to raise rates in 2023.

The Federal Reserve released a statement as well as its summary of economic projections for 2023 through 2025 after today’s FOMC meeting. One component of their economic projections was the most current “dot plot” which reveals assessments made by each Fed official. When the Fed is fully staffed the dot plot will contain 19 individual projections.

Image Source: Kitco News

2023 - All of the 19 Federal Reserve members who added their “dot” to the Fed’s projections reflected higher interest rates in 2023. The majority of members (10 votes) anticipate rates to be at 5 ¼%, with four members anticipating rates to go to 5 ½%, two members anticipating rates at 5 ¾% and two members anticipating rates at 4 ¾%. Read More

Gold is waiting for ‘opportunity' to ‘explode', 2023 will be a ‘commodities boom' - Todd Bubba Horwitz

The gold price held steady despite Wednesday’s announcement of a 50 bps hike in the Federal Funds Rate. The precious metal ended the day trading at $1,802 per ounce, down only $5.30 over the day.

These price movements signal that gold has a significant “upside,” according to Todd Bubba Horwitz, Editor of BubbaTrading.com.

“Gold feels, as does silver and platinum, like they want to explode to the upside,” he said. “They’re not waiting for an event, but an opportunity, to attract some new-money buyers that will push them out of these ranges that they’ve been trading at for quite a while.”

He predicted that in addition to precious metals performing well, 2023 would be a general “commodities boom.”

“I think in 2023, we’re going to have a commodities boom, and that includes the hard asset commodities of gold, silver, and platinum,” he said.

Horwitz spoke with David Lin, Anchor and Producer at Kitco News. 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.