Today's Gold and Silver News - January 6th

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Gold & Silver Market Analysis for Wednesday 5th January

Kinesis Money Gold Analysis: In 2021, the gold price started with a decline from $1,830 to $1,800, after the recovery of US bond yields. Within the support zone of $1,800, we have seen buyers being very active, and the price now recovering to $1,815.

From a technical point of view, a new positive signal would be highlighted with the surpassing of $1,830. However, a decline below $1,800 could bring the gold price back into the lateral channel of $1,760 and $1,800.

Analyzing the price in dollars per gram, bullion remains traded above $58. Read More

U.S. Mint sees strongest gold coin sales in 12 years, sells 1.25 million ounces in 2021

Despite gold's uninspiring performance in 2021, the precious metal saw an impressive wave of physical demand throughout the year.

Updated sales data released from the U.S. Mint on Monday showed demand for physical gold hitting its highest level since 2009. The U.S. Mint said that in 2021 it sold more than 1.25 million ounces of gold in various denominations of its American Eagle gold coins, up more than 48% from last year.

According to the sales data, the mint's busiest month last year was in January when it sold 220,500 ounces of gold. Another memorial month for the mint included June when it sold 182,000 gold ounces as gold prices dropped more than $100 in the month as the Federal Reserve signaled that it was looking at reducing its monthly bond purchases before the end of the year. Read More

Is the ECB behind the curve? Here's what to expect in 2022

The ECB seemed to have backed themselves into a corner for 2022. In comparison to some of the other central banks, the ECB is slightly behind the curve, but there is some justification. Inflation is one of the biggest concerns for the ECB.

The bank's target is 2%, and year-on-year inflation in the Eurozone currently stands at increased to 4.9% in November of 2021 from 4.1% in October, the highest reading since July of 1991.

Many Analysts and ECB members are expecting the rate to fall back towards the 2% target but have admitted that it could take longer than expected. ECB Vice President Luis de Guindos recently noted: "We are fully convinced that inflation will start to decline at the beginning of next year (2022) and in the second half of next year inflation will start to decelerate even more and will converge with our target of 2%." Read More

Gold price climbs despite U.S. private payrolls more than doubling expectations in December

Gold continued to advance above $1,800 an ounce after private-payrolls processor ADP reported a better-than-expected increase in jobs in December.

Private payrolls rose by 807,000 last month, ADP said on Wednesday. Market consensus calls were projecting an advance of 400,000. November’s data was downwardly revised to an increase of 505,000 jobs.

As the markets digested the latest ADP data, gold began to rise, with February Comex gold futures last trading at $1,822.30, up 0.42% on the day.

Looking at the components of the report, most of the job increases were reported in the service-providing sector, which added 669,000 positions. The leisure and hospitality sector saw the biggest monthly gains, with 246,000 positions added. Read More

What does bitcoin at $100k mean for gold price? Goldman weighs in

Bitcoin will continue to take investment flows from gold in 2022 as both assets compete to be stores of value amid these inflationary times, according to a note published by Goldman Sachs.

The latest bitcoins float-adjusted market capitalization estimates put the value at $700 billion compared to around $2.6 trillion worth of gold owned as an investment, said Goldman Sachs analyst Zach Pandl. This translates to bitcoin representing a 20% share of the "store of value" market.

And as crypto adoption continues to increase, so will bitcoin's share of that market, Goldman's analyst said in his 2022 prediction. This is why Goldman is forecasting a "hypothetical" scenario in which if bitcoin's "store of value" share were to expand to 50%, its price would rise to more than $100,000.

"Bitcoin may have applications beyond simply a 'store of value' - and digital asset markets are much bigger than Bitcoin - but we think that comparing its market capitalization to gold can help put parameters on plausible outcomes for Bitcoin returns," Pandl wrote. Read More

Gold, silver up as risk aversion a bit keener

Gold and silver futures prices are trading higher in midday U.S. dealings Wednesday. The safe-haven metals are getting some support from a bit more risk aversion in the general marketplace at mid-week. A lower U.S. dollar index and higher crude oil prices are also bullish outside market forces working in favor of the metals bulls today. Traders are now awaiting the U.S. data point of the day, which is this afternoon's Federal Open Market Committee FOMC minutes from the December meeting. February gold futures were last up $8.90 at $1,823.50 and March Comex silver was last up $0.069 at $23.125 an ounce. Read More

Gold price loses gains as Fed minutes signal faster rate hikes, balance sheet reduction

The price of gold edged down after the release of the December Federal Reserve meeting minutes signaled a possibility of earlier and faster rate hikes.

Federal Reserve officials noted that a tight labor market and high inflation in the U.S. might require faster rate hikes and a reduction in the central banks’ overall asset holdings, according to the meeting minutes released on Wednesday.

“Participants generally noted that, given their individual outlooks for the economy, the labor market, and inflation, it may become warranted to increase the federal funds rate sooner or at a faster pace than participants had earlier anticipated,” the minutes stated. Read More

Minutes reveal interest rate hikes are coming sooner and at a faster velocity

The Federal Reserve released the November FOMC meeting minutes today. What followed was a decisive shift in market sentiment in multiple financial sectors. All three major indices had strong selloffs immediately following the release of the November minutes. Concurrently the dollar lost value and did both gold and silver.

Major indices sustain a substantial decline in value

The Dow Jones industrial average opened at 36,722.60 and traded to an intraday high of 36,952.65, a new record high before succumbing to selling pressure. By the time the dust settled the Dow had lost 1.07%, or 392.54 points, and is currently fixed at 36,407.11 points.

After reaching an all-time intraday high yesterday the Standard & Poor's plummeted as the bullish market sentiment in U.S. equities quickly waned. The S&P 500 lost 1.94% today and the index is currently fixed at 4700.58. By far the greatest carnage in U.S. equities was found in the NASDAQ composite which lost 3.34% and is currently fixed at 15,100.17 points. Read More

Gold and silver move lower heading into the European open

Gold is trading -0.47% lower just at the $1800/oz area following the FOMC minutes last night. Silver is also struggling after falling 1.50% overnight. In the rest of the commodities complex, copper has dropped half a percent and spot WTI bucked the trend to move 0.39% higher.

Since the money markets are now pricing in a 70% chance of a Fed hike at the March meeting indices fell overnight. The Nikkei 225 (-2.88%), ASX (-2.74%) and Shanghai Composite (-0.25%) all dipped lower. Futures in Europe are indicating a negative cash open.

In FX markets, the dollar index is 0.20% higher, AUD/USD was the biggest casualty falling 0.84%. In the crypto space, BTC/USD is -0.75% in the red. 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.