Precious metals news

Gold prices hit a historic high of over $2,800 as investors sought safe-haven assets amid escalating trade tensions. The precious metal gained over 6% this month, driven by President Trump's renewed threats of 25% tariffs on Mexican and Canadian imports. Market experts, including WisdomTree's Nitesh Shah, suggest this rally could maintain momentum as long as trade policy uncertainty persists. Adding to gold's appeal, central bank buying remains a strong structural force in the market, while mixed economic signals - including slowing GDP growth but increased consumer spending - continue to support precious metals. With the Federal Reserve closely monitoring inflation and employment data, and Indian physical demand temporarily subdued due to high prices, analysts like ActivTrades' Ricardo Evangelista suggest gold could potentially reach $3,000 if high inflation and sluggish growth conditions prevail.

Gold prices surged to a historic peak above $2,800 per ounce, driven by a perfect storm of market uncertainties. President Trump's announcement of impending 25% tariffs on Mexican and Canadian imports, coupled with additional threats toward China, has intensified fears of a broader trade conflict. This market anxiety, combined with concerns about US fiscal policy and potential inflationary pressures from tax cuts and immigration reform, has propelled investors toward safe-haven assets. The Federal Reserve's decision to hold interest rates steady and adopt a wait-and-see approach, along with anticipated inflation data, has further supported gold's appeal. The precious metal's fifth straight weekly gain underscores persistent market unease about global economic stability and trade relations.

In this enlightening video, Mike Maloney reveals how everyday costs are a direct reflection of the dollar’s collapsing purchasing power.

The Federal Reserve voted unanimously to maintain interest rates at 4.25-4.50%, signaling a pause in its recent rate-cutting cycle amid uncertainty over President Trump's economic policies. Fed Chair Powell emphasized there's "no hurry" to adjust rates unless labor markets weaken or inflation pressures ease, prompting an angry response from Trump on social media. The decision reflects the Fed's cautious approach as it evaluates the potential impact of proposed tariffs and fiscal policies on inflation and employment.

Mortgage application volume declined 2% last week despite steady interest rates at 7.02%, reflecting continued weakness in housing market demand. Refinancing applications dropped 7% week-over-week, while purchase applications fell 0.4%. Despite ending 2024 on a positive note, current mortgage rates remain significantly higher than last year, limiting opportunities for both new buyers and refinancing homeowners.

London's bullion market is experiencing significant strain as banks rush to borrow gold from central banks following a massive flow of metal to the United States. Over two months, COMEX warehouse stocks increased by 12.2 million ounces (70%), driven by fears of potential US import tariffs. This has led to unprecedented delays at the Bank of England, with minimum waiting times for gold withdrawals extending to four weeks, compared to the usual few days.

Treasury yields declined across the curve Thursday, with the 10-year rate falling to 4.50%, as investors await crucial US economic data following the Federal Reserve's noncommittal stance on future rate cuts. The market's attention has shifted to upcoming GDP and inflation figures for policy guidance, while the European Central Bank is expected to cut rates amid economic struggles in the eurozone. The divergence between Fed and ECB approaches highlights the different economic challenges facing the two regions.

The European Central Bank is expected to reduce its deposit rate from 3% to 2.75%, marking the lowest level in nearly two years, as inflation continues to moderate and economic growth remains sluggish. While inflation stands at 2.4%, above the ECB's target, it's projected to decrease to 2.1% this year. The eurozone faces mixed economic signals, with core economies like Germany and France struggling while peripheral nations benefit from tourism, leading to a modest growth forecast of 1.1% for 2024.

Gold prices advanced to near-record levels around $2,778 per ounce, benefiting from a 0.1% decline in the dollar following the Federal Reserve's latest policy meeting. The precious metal's strength comes despite Fed Chair Powell's hawkish stance, where he emphasized the central bank won't rush into rate cuts and needs to see further progress on inflation. Market expectations for rate cuts have significantly shifted, with swap traders now pricing in only 50 basis points of cuts for the year, while some investment banks are forecasting no cuts at all. The metal's resilience is particularly notable given the complex economic backdrop, including potential Trump administration policies on tariffs and taxes that could stoke inflation. Traders are now focused on forthcoming fourth-quarter GDP data for additional insights into the US economic trajectory, while other precious metals including silver, platinum, and palladium also showed gains in London trading.

The Federal Reserve's recent rate-cutting cycle has failed to provide the financial relief many Americans anticipated, creating a stark disconnect between monetary policy and consumer reality. Despite a full percentage point reduction in the Fed's benchmark rate since September 2024, consumers face a challenging environment where borrowing costs remain elevated across multiple sectors. Mortgage rates continue to hover around 7%, vehicle financing remains expensive with new car loans at 6.8%, and credit card APRs have shown only minimal decreases. The situation is particularly dire for millennials, who represent the largest share of home buyers and are in their prime borrowing years, with 82% reporting significant financial impact from high rates. The lack of relief stems from several factors, including the complex relationship between Fed policy and consumer lending rates, persistent inflation, and broader economic conditions. Long-term rates, which govern mortgages and car loans, are tied more closely to...

Swiss gold exports to the United States rose dramatically in December, jumping eleven-fold to 64.2 tons – the highest level since March 2022. The surge, valued at nearly $6 billion, was driven by traders rushing to secure bullion ahead of potential tariffs. The market response was immediate and significant, with Comex gold futures commanding premiums exceeding $50 an ounce over London spot prices, creating profitable arbitrage opportunities. The ripple effects extended beyond the US market, as Swiss gold exports to the UK simultaneously surged more than thirteen-fold to 14 tons, while total Swiss exports actually decreased by 4.5% to 123 tons due to reduced shipments to Asian markets. This unprecedented movement of precious metals highlights how trade policy uncertainty can rapidly reshape global commodity flows and create significant market dislocations.

Federal Reserve Chairman Jerome Powell maintained a steady course at the January meeting, keeping interest rates between 4.25% and 4.50%. Amid political pressure and uncertainty around potential tariffs, Powell emphasized a data-driven approach, declining to comment on presidential statements or speculate about future policy changes. This measured stance suggests the Fed may hold off on rate cuts through 2025, particularly if new tariffs drive inflation back to 3%.

As I forecasted in a previous update, the Global Silver Mine Supply was revised significantly lower due to the Mexican mine supply dropping more than 30 million oz in 2023.  So, what's the future look like...

A shift is occurring in the global gold market as concerns over potential Trump-era tariffs trigger a massive movement of gold from London to New York. The Bank of England, which stores gold for central banks, has seen its processing times for gold withdrawals extend to four weeks from the typical few days, indicating severe pressure on the system. This migration has led to a 70% increase in COMEX warehouse stocks over two months, reaching 29.8 million ounces - levels not seen since August 2022. The exodus has depleted London's free-float metal supplies, forcing market participants to seek gold leases from central banks to maintain liquidity in the world's largest over-the-counter gold trading hub.

Commerzbank has increased its gold price forecast for the first quarter of 2025, raising it from $2,600 to $2,700 per troy ounce. Despite this near-term bullish adjustment, the bank has kept its year-end 2025 price target unchanged at $2,650 per troy ounce, suggesting they anticipate some moderation in prices after the first quarter.

The silver market is expected to maintain a significant deficit for the fifth consecutive year in 2025, driven by record-breaking industrial demand exceeding 700 million ounces. While global demand is expected to hold steady at 1.20 billion ounces, the market shows divergent trends across sectors. Physical investment is forecast to rise 3% in Western markets, while jewelry and silverware demand face pressure, particularly in India, where high local prices are expected to trigger a double-digit decline. The market is also being influenced by geopolitical factors, including concerns about Trump's tariff policies and Chinese economic uncertainty, which have affected both physical delivery demands and the gold:silver ratio.

Beef prices have hit historic highs, with sirloin steak reaching $11.67 per pound and ground beef at $5.61 per pound in December. The surge is driven by a combination of drought, high grain prices, and rising interest rates, which have forced many cattle farmers to reduce herds or exit the industry. With U.S. cattle inventory at its lowest since 1951 and consumer demand remaining strong, prices are expected to continue rising.

The Federal Reserve's next moves are becoming less certain as economists grapple with surprisingly resilient U.S. employment figures and sticky inflation. While the Fed has indicated plans for two rate cuts in 2025, some prominent economists, including BofA's Aditya Bhave, are now discussing the possibility of a rate hike instead. The key trigger for such a move would be if core PCE inflation, currently at 2.8%, rises above 3%, or if inflation expectations continue to climb. Consumer concerns about future inflation have already reached their highest level since 2008, partly due to uncertainty around proposed trade policies. However, most economists still favor a prolonged pause rather than a hike, noting the delicate balance between controlling inflation and maintaining labor market strength.

To combat the growing challenges of gold laundering and counterfeiting, the London Bullion Market Association (LBMA) has implemented a groundbreaking digital tracking system. The Gold Bar Integrity Database aims to prevent illicit gold from criminal gangs and conflict zones from infiltrating bank vaults, while also stopping the circulation of counterfeit bars bearing major refineries' logos. According to LBMA CEO Ruth Crowell, this initiative responds to increasing market demand for transparency and helps participants meet global sanctions requirements. The system will begin by monitoring LBMA-accredited refiners and London gold vaults, managed by major institutions like JPMorgan Chase and Brink's Co., which currently store approximately 695,000 gold bars valued at over $700 billion.

Gold prices remained relatively stable at $2,758.49 per ounce as markets await the Federal Reserve's policy decision and commentary on potential March rate cuts. The precious metal's recent approach to all-time highs, driven by Trump's calls for lower rates, was tempered by a tech sector sell-off triggered by Chinese AI developments. Investors are particularly focused on Fed Chair Powell's upcoming press conference and Trump's proposed trade policies, which could impact gold's safe-haven appeal.