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Gold & Silver Market Analysis – Wednesday 24th November
Kinesis Money Macroeconomic Analysis: Today’s market analysis firstly takes note of the recovery of gold. Expectations surrounding a quickening to tapering have been an obstacle to the gold price, as it is attempting to strengthen. The publication of recent US inflation figures could push the Federal Reserve to quicken the pace of quantitative easing in order to mitigate the growth of prices.
These pre-emptive expectations generated a further rally from the greenback. Furthermore, the dollar index, which measures the strength of the US dollar against a basket of other currencies, has jumped above 96. Reaching its highest level since July 2020, the dollar now remains steady at 96.6.
Meanwhile, the US 10 Year Treasury yield accelerated to the previous rate of 1.60% – market sentiment must suspect that the first-rate raise from the Federal Reserve is imminent.
Earlier this week, Joe Biden renominated Jerome Powell as Chairman of the Federal Reserve, in what will be his second term. This decision does not imply that there will be any imminent change of monetary policy. Although, it has been understood by the markets as confirmation that restrictive monetary policies have only just begun.
Kinesis Money Gold Analysis - Read More
Look for an oversold bounce in gold and silver
Everyone wants to know what happened and why gold, silver, and platinum have reversed so quickly. There is no textbook answer; however, the higher interest rate environment is not bullish for metals, which means the reappointment of Chair Powell is not a positive note for the bulls.
The overall economy is in horrible shape. The asset appreciation created in equities is more because of the money printing and increased money supply. In other words, the rally is more of a mirage than based on solid fundamentals. Like all markets, the metals have overreacted to news versus understanding the action behind it. Read More
Gold price sees some selling pressure following 4.1% rise in core PCE Index
Gold is seeing some selling pressure after the U.S. annual core Personal Consumption Expenditures price index came in line with expectations in October, rising 4.1%.
On a monthly basis, the core PCE price index was up 0.4% last month, the U.S. Department of Commerce said on Friday. Although core inflation rose in line with economic projections, prices pressures for the year are at their highest level since 1991.
The core inflation strips out volatile food and energy prices and is the U.S. central bank's preferred inflation measure.
The gold market has been able to hold in neutral territory through what has been a busy morning for economic data. December gold futures last traded at $1,781.80 an ounce, down 0.12% on the day. Read More
Gold price remains in neutral as Fed sees stickier inflation but not ready to raise interest rates
Despite some volatility Wednesday, the gold market is back in neutral territory. According to some analysts, the precious metal remains supported by the Federal Reserve's November monetary policy meeting minutes.
Although the U.S. central bank started reducing its monthly bond purchase following its last monetary policy meeting, the minutes show that the committee is in no hurry to raise interest rates.
"Participants noted that beginning to scale back the pace of net asset purchases was not intended to convey any direct signal regarding adjustments to the target range for the federal funds rate. They highlighted the more stringent criteria for raising the target range, compared with the criteria that applied to beginning to reduce the pace of asset purchases," the minutes said. Read More
Top 10 biggest gold mines in South America increased production 13% in Q2 2021 - report
Kitco ranked the top ten gold producing operations in South America in Q2 2021 based on data publicly released by their owners/operators. Read More
Gold near steady, shows little initial reaction to FOMC minutes
Gold and silver prices are trading not far from unchanged in afternoon U.S. trading Wednesday, after a huge day for U.S. economic data that produced not much markets reaction. December gold was last up $0.50 at $1,784.30 and December Comex silver was last up $0.04 at $23.475 an ounce. Read More
PCE inflation index for October confirms what consumers already know
Today the Bureau of Economic Analysis, a division of the US Department of Commerce reported that the cost-of-living has risen at the fastest pace in just under 31 years vis-à-vis the PCE (Personal Consumption Expenditures Price Index). The costs of goods and services increased by 0.6% in October. That takes the PCE index to 5% year over year. This is the greatest increase in inflation since December 1990. This also confirms a government report earlier this month indicating that the CPI (Consumer Price Index) rose to 6.2% in October, the largest rise since November 1990.
We have seen a steady and methodical increase in inflationary pressures in 2021 with the July PCE year-over-year at 4.1%, 4.2% in August, 4.4% in September, and now 5% in October 2021. Read More
Powell's renomination is 'historic', stars aligned for market disruption - DiMartino Booth
Biden's reappointment of Jerome Powell as Fed Chair on Monday signals a transition away from more "radical" monetary movements, said Danielle DiMartino Booth, CEO of Quill Intelligence.
In particular, the decision to reappoint Powell as Fed Chair and nominate Fed board member Lael Brainard as vice-chair signals a move towards more centrist monetary and fiscal policies, Booth said. Read More
Gold and silver trade higher leading into the European open
Gold (0.30%) and silver (0.50%) are trading higher this morning. The yellow metal is approaching $1800/oz again while silver trades at $23.66/oz. In the rest of the commodities complex, copper is 0.50% higher while spot WTI lost -0.10% of its value. 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.
