Today's Gold and Silver News: 31-01-2023

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Gold Price News: Gold Consolidates Ahead of Busy Week of Interest Rates

Gold remains in similar territory to where it has traded for the last couple of weeks as traders and investors prepare themselves for a busy week full of central bank rate decisions, including the Federal Reserve.

With the latest inflation figure out of the US showing that the pace at which the price of consumer goods is rising continues to slow, this has provided more bandwidth for the Fed to operate within and increased expectations that this week’s rate decision will bring a 25 basis point hike, three times smaller than most of the increases in 2022.

This less aggressive stance by the Fed has long since been priced in for gold with this change in sentiment being the catalyst for the precious metal’s impressive rally from early November onwards.

As a result, this week could well see gold remain in a similar range to where it is currently with the data so far continuing to align with expectations and therefore enabling the facts to catch up with a gold price that had surged to its highest level for nine months mainly on sentiment. Read More

Silver Price News: Silver Stuck In Doldrums With No Catalyst In Sight

Silver remains stuck in the doldrums with the price continuing to drift between $23.50-$24 an ounce, a range it has been stuck in since the second half of December. 

While this week brings interest rate decisions from the Federal Reserve, the European Central Bank and the Bank of England, none of these are likely to materially impact the silver price, assuming the three banks raise their rates in line with market expectations.

Indeed, the Fed’s likely 25 basis point increase has been talked about, and therefore priced in, for so long that investor focus has shifted to where the US central bank sees rates going in the coming months and how soon it will stop hiking rates altogether.

While this softening of the Fed’s stance is welcome for silver investors, with the Fed’s series of hikes in 2022 the main reason for silver’s plunge from April to September last year, the precious metal has failed to gain as much as gold has on the same news. Read More

Turkey to boost gold production and rely less on imports, says Erdogan

Turkey plans to keep increasing its gold production so it can rely less on imports, said the country’s President Recep Tayyip Erdogan.

“Our gold production, which was almost zero in 2000, broke the record of the history of the Republic [of Türkiye] with 42 tons in 2020. According to the data of the last five years, our average production is around 35 tons,” Erdogan said during the opening ceremony of the Gubretas Gold Mine in western Anatolia.

The new mine, located in the Western part of the country, is looking to produce 6.5 tons of gold a year.

“With the new discoveries, we are aiming to increase our production. This will be important in terms of foreign trade balance,” Erdogan said. “For very many years, Turkey could not benefit from its potential in the field of precious metal. Turkey has been subject to a significant number of plots [to hinder its precious metal sector] in the pretext of environmentalism.”

Erdogan wants Turkey to be more independent regarding precious metals and depend less on imports. Read More

Hedge funds add to their bullish bets on gold ahead of pivotal FOMC decision

For the eighth consecutive week, hedge funds increased their bullish exposure in gold and reduced their bearish bets, according to the latest trade data from the Commodity Futures Trading Commission.

The CFTC's disaggregated Commitments of Traders report for the week ending Jan. 24 showed money managers increased their speculative gross long positions in Comex gold futures by 7,279 contracts to 131,501. At the same time, short positions fell by 3,223 contracts to 51,622.

The gold market is now net long by 79,879 contracts, holding at last week's nine-month high. During the survey period, gold prices tested resistance just below $1,950 an ounce.

So far this year, gold investors have bought 2.6 million ounces of gold in speculative positioning and exchange-traded funds, Nicky Shiels, head of metals strategy at MKS PAMPs, said in a note Monday.

While gold has solid technical bullish momentum, analysts continue to warn investors that the precious metal is ripe for a correction as the price hits resistance at a nine-month high. Read More

Gold, silver tread water just ahead of FOMC meeting

Gold prices are modestly down and silver slightly up in midday U.S. trading Monday. Gold is seeing a mild corrective pullback and a bit of profit-taking from futures traders after prices last week hit a nine-month high, and just ahead of this week’s highly anticipated monetary policy meeting of the U.S. Federal Reserve. February gold was last down $6.00 at $1,923.40 and March silver was up $0.123 at $23.75.

The U.S. data point of the week is the Federal Reserve Open Market Committee (FOMC) meeting that begins Tuesday morning and ends Wednesday afternoon with a statement. Most believe the Fed will raise the key U.S. interest rate by 0.25%, following the recent 0.5% rate hikes. Trading in stock and financial markets early this week may be more muted ahead of the FOMC statement and press conference by Fed Chairman Jerome Powell Wednesday afternoon.

Technically, February gold futures bulls still have the solid overall near-term technical advantage. A three-month-old uptrend is in place on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $2,000.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $1,885.00. First resistance is seen at today’s high of $1,933.60 and then at the January high of $1,949.80. First support is seen at last week’s low of $1,912.50 and then at $1,900.00. Wyckoff's Market Rating: 8.0.

Image Source: Kitco News

March silver futures bulls have the overall near-term technical advantage. However, trading has been choppy and sideways for weeks. Silver bulls' next upside price objective is closing prices above solid technical resistance at the January high of $24.775. The next downside price objective for the bears is closing prices below solid support at $22.00. First resistance is seen at $24.400 and then at last week’s high of $24.415. Next support is seen at Friday’s low of $23.39 and then at $23.26. Wyckoff's Market Rating: 6.5. Read More

Image Source: Kitco News

Gold is vulnerable to a pullback as Powell prepares to signal 'seriousness', but will hit an all-time high in 2023 - Adrian Day

Gold has rallied over the past three months up 17.7 percent, and is up over 5 percent year-to-date. However, as the Federal Open Market Committee meets on Tuesday to decide on a rate hike, gold is vulnerable to a pullback, as Fed Chairman Jerome Powell is set to adopt hawkish rhetoric in his press briefing that day. 

This is the assessment of Adrian Day, Chairman and CEO of Adrian Day Asset Management, a seasoned veteran of the financial industry and author of multiple books.

"I think gold is vulnerable to a pullback because the market is so convinced of a 25 basis point [hike] and a pause in March," he explained. "Powell doesn’t like the fact that the stock market is continuing to go up, which means the stock market is not taking him seriously… His incentive is to come out and say something strong, that we [The Fed] are going to keep on with this job until inflation is defeated." Read More

Video: Gold to hit all-time high in 2023, only this can stop it - Adrian Day

Three factors that have transformed the gold market in the last 30 years - WGC

The gold market has a 5,000-year history as a store of value; however, in the last 30 years, the precious metal has established itself as an essential global asset in a world filled with uncertainty, according to the latest report from the World Gold Council.

Tuesday, the WGC celebrated the 30 anniversary of its quarterly and annual Gold Demand Trends report, which looks at all pillars of physical demand in the global marketplace, including jewelry purchases to investor demand and central bank gold holdings.

In an interview with Kitco News, Juan Carlos Artigas, global head of research at the World Gold Council, said that over the last 30 years has evolved to become a more robust and profound market, providing investors around the world with stability and value in their portfolios.

"There is more to gold than one specific market," he said. "In the last 30 years, the market has changed a lot and the reality is that gold is as important as ever."

Looking at gold as an asset class, the WGC noted that in the last 30 years, the price had risen from around $330 an ounce, when the first GDT was published, to ending 2022 at $1,814 an ounce.

"With a 5.8% annualized return over the period, gold has outperformed cash, bonds and commodities," the analysts said. "Gold has also maintained a very low average correlation to stocks, even rising in times of turmoil and performing positively in five out of the past seven recessions, helping investors to reduce their portfolio losses."

Artigas said that what makes gold a stable and valuable asset is that there is not just one factor that has contributed to gold's growing role in financial markets. Read More

Gold demand hits nearly a decade high in 2022 driven by bullion and central bank purchases - WGC

Physical investment in gold from retail investors and central banks was the dominant theme for 2022 as the market saw the most significant growth in roughly 10 years, according to the latest report from the World Gold Council.

Tuesday, the WGC published its fourth quarter and full-year Gold Demand Trends report, which highlighted "vigorous" bullion purchases from retail consumers and unprecedented purchases from central banks. In total, annual global gold demand jumped 18% last year to 4,741 tonnes, "almost on a par with 2011 – a time of exceptional investment demand," the report said.

The full-year gains were helped part by record demand in the fourth quarter of 1,337 tonnes, the WGC added.

Growth in the gold market came as investments in gold-backed exchange-traded funds declined by 110 tonnes last year. However, the WGC said ETF outflows in 2022 were significantly better than 189 tonnes sold in 2021.

Retail investors did most of the heavy lifting as global bar and coin demand rose to a nine-year high of 1,217 tonnes, up 2% from 2021. The report said that total investment demand rose 10% to 1,107 tonnes last year. Read More

Russia to Price Silver in Gold Grams?

In this week’s Live from the Vault, Andrew Maguire reports on the accelerating adoption of a gold benchmark price for silver and commodity trades between nations, while examining the main drivers behind the current gold price rally.

The lifelong wholesaler reflects on the global implications of Russia’s plan to launch its own gold-pegged stablecoin, evaluating its potential to undermine the role of fiat currencies in foreign trade transactions.

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.