Precious metals news

March has seen gold's price soar, hitting a new record of USD 2,221 per ounce, fueled by the Federal Open Market Committee's (FOMC) announcement of three projected rate cuts this year. Despite a slight dip following a surge in the dollar, gold is on track for a 7% gain this month, with silver not far behind at a 10% increase. This rally comes after both metals faced declines earlier in the year, reacting to rising dollar values and U.S. Treasury yields, which were influenced by higher inflation expectations and reduced rate cut forecasts.

BlackRock's Larry Fink has pointed out that India's deep-rooted love for gold hasn't significantly benefitted its economy or yielded strong returns for investors. In his annual letter, the BlackRock Founder and Chairman reflects on discussions with Indian policymakers during his visit last November, highlighting their concerns over the nation's gold consumption. Despite its cultural significance and status as a symbol of wealth, Fink notes, gold's performance has lagged behind the Indian stock market, offering little in terms of economic stimulus.

HSBC has launched the first bank-issued tokenized gold product for retail customers in Hong Kong, named HSBC Gold Token. This move is part of both the bank and the government's initiative to make real-world assets digitally accessible. Tokenized gold represents physical gold ownership recorded on a blockchain, aiming to meet the growing demand for digital assets. The launch follows the Hong Kong government's efforts to promote digital asset accessibility, highlighted by recent regulatory guidelines from the Securities and Futures Commission. This innovative step could redefine how investors interact with gold and digital assets.

Money Supply is a very important indicator. It helps show how tight or loose current monetary conditions are regardless of what the Fed is doing with interest rates. Even if the Fed is tight, if Money Supply is increasing, it has an inflationary effect.

Gold prices increased on Tuesday, buoyed by the growing anticipation of U.S. Federal Reserve rate cuts. Investors are keenly awaiting this week's inflation data to assess potential cut timings. Spot gold saw a 0.2% rise to $2,176.59 per ounce, with an early session peak of a 1.3% jump. U.S. gold futures slightly rose by 0.04%, closing at $2177.2.

The Bank of Canada emphasizes the urgent need for businesses to increase investments in productivity to combat inflation. Senior Deputy Governor Carolyn Rogers described the situation as critical for economic protection against inflation without depending solely on higher interest rates. Despite high rates, it's premature to discuss reductions. Canada's productivity struggle, marked by minimal investment and underutilized newcomer skills, could exacerbate inflation as globalization benefits diminish. Recent data shows a pressing need for reversing the trend of declining productivity.

Traditional inflation reports, focused on the past 12 months, overlook the broader, cumulative impact of inflation since the start of the Covid period in January 2020. This period, marked by significant monetary expansion and near-zero interest rates to combat the recession, has led to a 20% cumulative inflation rate. This means a dollar now holds only 83 cents of its January 2020 value, highlighting the sustained loss in purchasing power. This overlook in reporting fails to account for the lasting financial strain on those whose incomes have not kept pace, exacerbating financial disparities.

The Central Bank of Nigeria has increased its key interest rate by 200 basis points to 24.75%, aiming to combat the country's severe inflation and currency devaluation. Following a 400 basis point hike in February, this marks the second consecutive increase, underscoring the central bank's aggressive approach to inflation, which stood at 31.7% year-on-year in February. Governor Olayemi Cardoso emphasized the necessity of this action to manage inflation expectations and support the naira, which has shown some recovery after a significant drop. Experts anticipate further hikes but expect the policy to stabilize towards the year's end.

In 2023, the Federal Reserve reported an unprecedented operating loss of $114.3 billion, halting its payments to the Treasury due to high interest rates. The Fed's interest expenses surged to $281.1 billion, driven by costs related to reverse repo operations, while its income from assets was $163.8 billion. Typically, profits from the Fed's securities go to the Treasury, reducing the federal deficit. The shortfall since late 2022 led to a deferred asset for the Treasury, increasing to $133.3 billion, yet affecting neither the federal budget nor monetary policy strategies.

Larry Fink, CEO of BlackRock, has issued a dire warning about the U.S. debt crisis, stating it's more urgent now than ever. Fink emphasized that neither taxes nor spending cuts alone could solve the problem, likening the potential future to Japan's economic stagnation in the late '90s. He highlighted the danger of rising debt servicing costs, making it tough to combat inflation. Fink calls for economic growth through infrastructure investments, particularly in energy, to avoid a looming debt catastrophe.

While the United States is now the world's largest petroleum producer, the important high-quality conventional oil supply is at a 50-year low.  There Lies the Rub, but the market doesn't realize it because $23 trillion of additional U.S. Treasury issuance since the 2008 GFC propped up the U.S. Shale Oil...

Goldman Sachs analysts project that gold's impressive 8% rally this month is just the beginning, with predictions of the precious metal reaching $2,300 an ounce by the end of the year. This surge comes as gold futures recently peaked at $2,182 an ounce.

Credit card debt has surged, reaching a record $1.13 trillion in the last quarter of 2023, as per the Federal Reserve Bank of New York. However, the impact of credit card debt varies significantly from state to state. A recent Bankrate study sheds light on this disparity, comparing states based on average credit card balances against household incomes. Louisiana, Mississippi, Oklahoma and West Virginia are the most burdened states based on our methodology. The least debt burdened state is Massachusetts, followed by Minnesota, New Hampshire, California and New Jersey.

A recent Deutsche Bank survey reveals a significant shift in investor sentiment regarding the U.S. economy's future. While last year, a majority of investment banks and Wall Street investors were bracing for a recession, driven by persistent inflation and rising interest rates, the current outlook has dramatically changed. Now, nearly half of all investors believe in a 'no landing' scenario, where inflation persists without leading to a recession.

Vivek Ramaswamy, a notable figure in the 2024 presidential primaries, has garnered attention for his critical stance on the Federal Reserve, a topic largely ignored by other candidates. He advocates for a monetary policy centered on maintaining a stable dollar price level. This unique focus on the Fed's role in economic stability distinguishes Ramaswamy's approach from his political peers.

The World Bank shares their Gold Investing Handbook for Asset Managers. Spanning over 70 pages, this handbook compiles cutting-edge research on gold investments from some of the world's leading experts.

Researchers from the Federal Reserve Bank of Philadelphia, Jesús Fernandez-Villaverde and Daniel Sanches, have found that adopting a gold standard could lead to long-term price stability. Their study, published in February, simulates how a gold standard might function in a small open economy. According to their findings, prices would naturally align with their long-term equilibrium, making inflation and deflation temporary issues. This suggests that a gold-based monetary system could offer a more stable pricing environment.

In this thought-provoking video, precious metals expert Mike Maloney dives deep into the current economic landscape.

Gold's recent rally to over $2,200 an ounce, marking a significant 10% increase since mid-February, underscores a turning point for the precious metal. This surge, surprising to many, affirms the strength of several factors working in favor of gold. The Federal Reserve, under Jerome Powell's guidance, has hinted at a softer monetary approach, potentially cutting rates up to three times in 2024. This shift away from the stringent monetary policies of the past year and a half signals a brighter outlook for gold. As real yields decrease, the appeal of gold, which doesn't bear interest, naturally grows, positioning it as an increasingly attractive investment amidst the anticipated rate cuts.

Joe Cavatoni, a market strategist at the World Gold Council, recently appeared on 'Closing Bell: Overtime' to share insights into gold's burgeoning market performance as it approaches record-high values. Cavatoni emphasized that the current economic climate, marked by rate cuts, is highly favorable for investing in gold. His analysis points to the precious metal's appeal as a safe-haven asset, particularly in times of financial uncertainty and adjustments in monetary policy.