Precious metals news

While the primary catalyst for the original English pilgrims to venture to America was religious freedom, a strong desire for independence followed closely behind. They desired to be independent of two things: poverty and government meddling. This spirit carried into the American Revolution and informed domestic policy for many years. The Homestead Act of (FIND YEAR) was enacted to allow citizens a type of independence those who first fled Britain could only dream of. Remote settlers earned their own homes by proving their merit to Mother Nature. It was fairly easy to live as one wished without violating rules and regulations. The law was a fairly small framework that attempted to allow lives free from violence and evil. The two curses they fled were now powerfully refuted. The poverty caused by government oppression of the past was replaced by success or failure based upon individual action. 

Gold prices remained steady above $2,400 per ounce on Friday, poised for a third consecutive weekly gain. This stability comes as investors grow increasingly confident that the Federal Reserve will soon cut interest rates, following unexpected declines in U.S. consumer prices. Despite a hotter-than-expected producer price index report causing some profit-taking, the overall sentiment remains bullish. Markets are now pricing in a 96% chance of a rate cut in September, which would reduce the opportunity cost of holding non-yielding gold. While gold and silver have shown strength, platinum and palladium are set for weekly declines, with long-term bearish outlooks due to declining autocatalyst demand.

U.S. consumer sentiment unexpectedly dropped to an eight-month low in early July, according to the University of Michigan's preliminary reading. Despite expectations for easing inflation, consumers remain frustrated with persistently high prices, which are eroding living standards. The sentiment index fell to 66 from 68.2 in June, contrary to economists' predictions of a slight increase. While consumers' inflation expectations for the next year and the long term decreased slightly, nearly half of the respondents spontaneously expressed concerns about high prices impacting their quality of life. This decline in sentiment comes despite recent data showing cooling inflation, highlighting the ongoing impact of price pressures on consumer perceptions of the economy.

Following softer-than-expected inflation data, bond traders are increasingly betting on the possibility of a larger-than-usual 50 basis point interest rate cut by the Federal Reserve in September. This shift is evident in the federal funds futures market, particularly in October contracts, which have seen record trading volumes. While these contracts already fully price in a standard quarter-point cut for the September 18 meeting, the increased buying at higher price levels suggests growing expectations for a more aggressive move. Swap contracts now indicate a full quarter-point cut in September and a total of 60 basis points of easing by year-end, reflecting a significant change in market sentiment regarding the Fed's monetary policy trajectory.

In this eye-opening video, Mike Maloney explores the troubling signs pointing towards an impending financial crisis that could surpass the devastation

The London Bullion Market Association (LBMA) and World Gold Council (WGC) are advocating for gold to be reclassified as a High-Quality Liquid Asset (HQLA) under Basel III regulations. In a recent meeting with the Bank of International Settlements (BIS), they presented data and research supporting this change, which could enhance market stability, improve liquidity, and boost confidence in the financial system. The BIS representatives provided positive feedback and guidance on additional information needed to progress the reclassification. This move could significantly benefit financial institutions and the broader economy by strengthening gold's role in the global financial system.

VanEck CEO Jan van Eck expresses strong bullish sentiment towards both Bitcoin and gold, citing various market dynamics and global economic factors. Despite short-term pressures on Bitcoin, including government selling and liquidations, he maintains a positive long-term outlook, noting continued retail investor interest in spot Bitcoin ETFs. For gold, van Eck points to record highs driven by geopolitical tensions and increased central bank purchases. He highlights the declining appeal of traditional safe-haven currencies, making both gold and Bitcoin attractive alternatives. Looking ahead, van Eck anticipates potential fiscal challenges in 2025, particularly regarding U.S. Social Security, and expects continued Federal Reserve easing policies to support both assets.

San Francisco Federal Reserve Bank President Mary Daly has indicated that recent cooler inflation readings are encouraging, and she anticipates further easing in both price pressures and the labor market to justify interest rate cuts. While Daly sees it as likely that policy adjustments will be warranted, she remains uncertain about the exact timing. She suggests that one or two interest rate cuts this year, as projected in the June Fed policymaker forecasts, could be appropriate if inflation continues to cool, though progress may be uneven. Daly's comments reflect a cautious optimism about the economic outlook and a willingness to consider rate cuts in response to improving economic conditions.

The June 2024 inflation report, showing a decrease to 3% year-over-year, has significantly increased market expectations for Federal Reserve interest rate cuts. This data has led to a surge in rate cut bets, with the probability of a September cut rising to 91%. As a result, investors are flocking to interest-rate-sensitive assets, including Treasury bonds, low-yield currencies like the Japanese yen, and gold. The market reaction includes falling Treasury yields, a weakening U.S. dollar, and gold prices approaching all-time highs. This shift in sentiment suggests that investors are increasingly confident that the Fed's inflation target is within reach, potentially leading to multiple rate cuts by the end of the year.

Silver prices have surged over 2%, breaking through key resistance levels and confirming a 'double bottom' chart pattern. This bullish momentum, fueled by weaker-than-expected US inflation data, has pushed the XAG/USD to $31.40, a six-week high. The breakout above the $30.73 neckline has opened the door for further gains, with potential targets at $31.75, $32.00, and the year-to-date high of $32.51. The Relative Strength Index (RSI) supports this upward trend. However, key support levels at $31.00, $30.73, and $29.82/79 remain crucial for potential pullbacks. This price action has reignited discussions about potential Federal Reserve monetary policy easing.

Federal Reserve Chair Jerome Powell has declared that the U.S. labor market has achieved balance, marking a significant shift from the past three years when a tight job market was cited as a reason for maintaining high interest rates. This change in stance suggests that the Fed no longer views the labor market as a primary source of inflationary pressure. The cooling job market, evidenced by more concentrated hiring in specific sectors like healthcare and government, may now support the case for potential interest rate cuts in the near future. This development indicates that the Fed is reassessing its policy approach, considering both inflation risks and the potential negative impacts of prolonged high rates on the economy.

The yen steadied on Friday, a day after the Bank of Japan likely intervened to prop up the currency, on the coat-tails of an unexpected drop in U.S. consumer prices that fuelled the largest drop in the dollar since May. Daily operations data from the BOJ on Friday suggested the central bank had spent between 3.37-3.57 trillion yen ($21.18-22 billion) on buying the yen on Thursday, less than three months after its last foray into the market. Tokyo's top currency diplomat, Masato Kanda, said on Friday authorities will take action as needed in the foreign exchange market, but declined to comment on if authorities had intervened.

The potential interest rate cuts by the Federal Reserve could lead to a weaker U.S. dollar, potentially making future international travel more expensive for Americans. This is because interest rates and currency strength are closely linked, with higher rates typically supporting a stronger dollar. As the Fed signals possible rate cuts in 2024 and 2025, experts anticipate downward pressure on the dollar's value. However, some financial analysts believe the dollar's strength may persist. The current strong dollar has made overseas travel more affordable for Americans, particularly in countries like Japan, where the exchange rate has been highly favorable. This situation could change if the dollar weakens, affecting the purchasing power of U.S. travelers abroad.

The United States experienced a significant cooling in inflation rates in June, with prices rising by only 3% over the past 12 months, marking the slowest pace in a year. This decline, largely attributed to lower gasoline prices, represents the third consecutive month of easing inflation. The trend is easing financial pressures on households and potentially paving the way for the Federal Reserve to consider interest rate cuts as early as September. While some staples like groceries and housing costs continue to rise, the overall inflation picture is improving, offering a glimmer of hope for the economy and potentially alleviating some of the economic dissatisfaction faced by the current administration.

As student loan debt in America swells to a staggering $1.7 trillion, President Joe Biden's new SAVE plan could actually cost $230 billion, a CBO report finds. This is not only a classic case of robbing Peter to pay Paul — it will bring more inflation, make college more expensive and give the federal government unprecedented control over higher education.

Gold closed the week at $2,410 (up $19) and silver at $30.77 (down $0.43). JD and Joel interview Representative Ken Ivory, the man behind Utah's recently-passed HB 348 law. This law enables the state to invest 10% of its $1.4 billion rainy day fund into gold and silver, stored in Brinks Salt Lake City. They also unpack the big CPI news and Fed rate cut expectation.

With the retirement of nearly half of the U.S. Coal Generating Capacity in the past 15 years is Coal-Fired Power... DEAD?  I don't think so.  Matter-a-fact, if natgas power generation gets into trouble, there is plenty of spare coal-fired capacity that can come online...

Gold climbs above $2,415 mark as US Inflation data boosts rate-cut expectations; silver rises to $31.50

Gold futures experienced a significant surge on Thursday, approaching record highs following the release of U.S. inflation data showing a cooling trend. The Consumer Price Index (CPI) reported a 0.1% decrease in June, the first decline since May 2020, which investors interpreted as potential justification for the Federal Reserve to implement interest rate cuts. This unexpected downturn in inflation has bolstered sentiment among those anticipating earlier rate reductions. As a result, August gold futures on Comex rose by 1.8% to $2,421.90 an ounce, nearing the all-time intraday high of $2,454 and settlement high of $2,438.50 set on May 20.

Deutsche Bank's latest Global Mining & Commodities Survey reveals a shift in investor preferences, with gold emerging as the favored commodity in the short term, while copper maintains its appeal for the medium term. This change is driven by concerns over China's economic slowdown and potential delays in the energy transition. The survey indicates a growing preference for early-cycle commodities like iron ore and coal, alongside expectations of easing supply constraints for metals crucial to decarbonization efforts. While ESG factors continue to influence perceptions of the mining sector, investors are increasingly focused on local environmental issues such as water stress and community relations.