Today's Gold and Silver News - 6th October

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Silver Dips Below $21 as Market Assesses Whether Fed Will Change Tack

Although silver has dipped back below $21 an ounce in early Wednesday trading, the shot in the arm the precious metal received on Tuesday is still more than strong enough to shift it out of the range-bound narrative the metal had been experiencing in recent weeks.

Weaker-than-expected recent US economic and jobs data have raised the prospect of the Federal Reserve having to be less aggressive with its upcoming interest rate hikes to avoid tipping the world’s largest economy into a recession. Read More

Gold Holds Above $1,700 on Expectation of Less Aggressive Fed

Gold has dropped back a fraction on Wednesday after its remarkable gains on Tuesday that saw it climb back above $1,700 an ounce, a move that looked highly unlikely just a matter of days ago.

The significant gains were driven by economic data out of the US, namely September’s ISM Manufacturing PMI and August job opening figures, that came in below forecast, suggesting the world’s largest economy isn’t proving as resilient from the series of interest rate hikes implemented by the Federal Reserve after all. Read More

Turkey's gold imports jump nearly 550% as inflation accelerates to 83.45% in September

Turkey saw gold imports shoot up 543% to $3.1 billion in September, the latest data from the Trade Ministry revealed. In the meantime, annual inflation has accelerated to a fresh 24-year high of 83.45% in September.

Turkey's total trade deficit jumped 298% year on year to $10.384 billion in September, the Trade Ministry said on Tuesday. Overall, exports advanced 9.2% to $22.62 billion, while imports surged 41.5% to $33 billion.

This was largely due to energy imports, which rose 115% to $9.56 billion last month, marking the highest monthly level on record.

The country's Trade Minister Mehmet Mus stated that energy imports were about a third of total imports in the first nine months of the year. One of the top exporters to Turkey is Russia because of the energy element. Read More

Gold's correlation with Bitcoin hits its highest level in a year

The surging dollar and rising interest rates have had a variety of knock-on effects, including the collapse in the value of the British pound against the dollar, as global investors dumped assets in favor of the appreciating USD. 

As traders sold off assets like gold and to a lesser extent Bitcoin, the correlation between the two supposed inflation hedges has risen to its highest level in more than a year, according to a recent report from crypto market data provider Kaiko. 

With gold currently trading down 5.75% on the year, combined with the double-digit decline experienced by Bitcoin (BTC), the poor performance of the two has brought them closer in alignment with each other and has led to a current correlation coefficient of 0.3. Read More

Will this silver and gold price rally last? Here's what analysts are saying

In a surprise u-turn this week, silver and gold are trading at 3-month and 3-week highs, respectively. But is this a sustainable rally or just a short squeeze?

Even though silver has outperformed gold this week, both precious metals saw impressive performance. Some main drivers were a weaker U.S. dollar, falling U.S. Treasury yields, higher crude oil, and renewed safe-haven buying amid shifting Fed rate hike expectations and disappointing macro data.

"There have been vicious reversals in precious metals, with Gold +5%, Silver +14%, Platinum +9% and Palladium +11% the past five days," said MKS PAMP metals strategist Nicky Shiels. "Gold has essentially erased 1/4 of the downtrend channel worth $460 (from March '22 peak to its September tough), which started from its invasion/war peak price at $2,070/oz; silver has clawed back 2/5th (in 3 days!) of the same downtrend channel."

The United Nations also spoke up this week, urging the Federal Reserve and other central banks to ease up on rate hikes, warning that tighter monetary policies are pushing the global economy into a recession.

"There's still time to step back from the edge of recession," UNCTAD Secretary-General Rebeca Grynspan said. "But the current course of action is hurting the most vulnerable, especially in developing countries and risks tipping the world into a global recession." Read More

Gold price weighs U.S. private payrolls number ahead of Friday's employment report

Gold edged down after private-payrolls processor ADP reported a slightly better-than-expected increase in jobs in September.

Private payrolls rose by 208,000 last month, ADP said on Wednesday. Market consensus calls were expecting an advance of 200,000. August’s data was upwardly revised to an increase of 185,000 jobs.

Gold was under pressure but did not see a strong reaction to the data, ticking slightly down. December Comex gold futures last trading at $1,719.60, down nearly 0.63% on the day. Read More

Gold price hits new daily lows as U.S. service sector beats expectations

Gold dropped as momentum in the service sector was slightly better than expected in September, according to the latest data from the Institute of Supply Management (ISM).

The Services Purchasing Managers Index (PMI) was at a reading of 56.7% last month, down from August’s 56.9%. The 0.2 percentage-point decline was a surprise to the upside as market consensus calls were expecting the index to come in at 56.0%.

Readings above 50 are seen as a sign of economic growth – the farther an indicator is above or below 50, the greater or smaller the rate of change.

Looking at the specifics, the new orders sub-index was at 60.6%, following August’s reading of 61.8%. The business activity sub-index was at 59.1% compared to the 60.9% registered in the previous month. The employment rose to 53% after August’s 50.2% reading. Economists keep a close eye on the latter number as a gauge of the employment situation in the country. Read More

Gold, silver prices pull back as U.S. dollar, bond yields see strong rises

Gold and silver prices are lower in midday U.S. trading Wednesday, on routine downside price corrections following solid gains posted on Monday and Tuesday. A strong rebound in the U.S. dollar index today, along with a significant rise in U.S. Treasury yields, are also bearish outside market elements working against the gold and silver markets at mid-week. December gold was last down $11.60 at $1,718.90 and December silver was down $0.649 at $20.455.

Gold prices down-ticked following the early morning release of a slightly stronger-than-expected U.S. ADP jobs report showing a gain of 208,000 in September. That compares to expectations for a rise of 200,000. Arguably the most important U.S. data point of the week, if not the month, is Friday's employment situation report for September from the Labor Department. The key non-farm jobs number is expected to come in at up 275,000. The August report showed a non-farm jobs rise of 315,000.

Technically, December gold futures saw a routine corrective pullback. Prices hit a three-week high Tuesday. The gold futures bears still have the overall near-term technical advantage. However, it appears a near-term market bottom is in place. Bulls' next upside price objective is to produce a close above solid resistance at $1,778.80. Bears' next near-term downside price objective is pushing futures prices below solid technical support at this week's low of $1,666.50. First resistance is seen at this week's high of $1,738.70 and then at the September high of $1,746.40. First support is seen at today's low of $1,708.80 and then at $1,700.00. Wyckoff's Market Rating: 3.0.

Image Source: Kitco News

December silver futures also saw a routine corrective pullback after hitting a three-month high Tuesday. The silver bulls have the slight overall near-term technical advantage. Silver bulls' next upside price objective is closing prices above solid technical resistance at $22.50. The next downside price objective for the bears is closing prices below solid support at $19.00. First resistance is seen at $21.00 and then at this week's high of $21.31. Next support is seen at $20.00 and then at $19.60. Wyckoff's Market Rating: 5.5. Read More

Image Source: Kitco News

Gold price rally to resume after foundation akin to 1999 is built, watch USD vs. EUR disparity, says Bloomberg Intelligence

Gold is building a foundation similar to the one established in 1999, and once that price base is established, the gold rally will resume, according to Bloomberg Intelligence.

The price bottom established in 1999 at around $250 was so solid that gold never returned below it again. And Bloomberg Intelligence's senior commodity strategist Mike McGlone sees a similar pattern developing in 2022. McGlone pointed to gold in U.S. dollars vs. gold in euros and Japanese yen as something to keep a close eye on.

"The disparity in dollar-denominated gold vs. euro-based is nearing levels that formed a lasting foundation for the metals price in 1999. Down about 10% in 2022 to Sept. 28, dollar gold compares with respective gains of 5% and 10% for the euro and yen," McGlone said. "Aggressive Fed tightening to address inflation and elevated asset prices -- which is buoying the greenback, as the rest of the world tries to catch up -- echoes trends about two decades ago. Underpinnings are firming for the price of gold to resume the rally that started with that base."

Global GDP is dropping dramatically after central banks synchronized their rate hikes in the global battle against inflation. But eventually, there will be a reversal. Read More

Russians embrace precious metals: Sberbank sold 89 tonnes of silver and 7 tonnes of gold in 2022

Russia's largest lender Sberbank sold 100 tonnes of precious metals, and 89 tonnes of that was silver.

Sberbank customers have opened 300,000 new unallocated metal accounts between January and September, Interfax reported, citing the bank's statement this week.

And the total amount of precious metals sold was around 100 tonnes. According to the bank, nearly seven tonnes of that was gold, 89 tons was silver, and a tonne each of platinum and palladium.

On gold, Russians spent around $550 million at Sberbank.

Unallocated precious metal accounts mean the bank remains the owner of the precious metal bought, and the clients' accounts only get credited. Sberbank has developed the option of unallocated precious metals accounts to expedite the process of opening the account and selling precious metals. 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.