Precious metals news

Treasury Secretary Janet Yellen highlighted the potential for a turbulent decrease in inflation, despite recent signs of persistent price pressures in the U.S. economy. In a FOX Business interview, Yellen addressed stagflation worries, asserting that the battle against inflation is ongoing and has not hit a standstill. Yellen emphasized, "Expect fluctuations, but the overall trend is promising." She also reiterated President Biden's commitment to tackling the high costs affecting Americans, signaling that smoothing out inflation remains a top government priority.

As interest-rate reductions remain off the agenda, the US Federal Reserve's attention turns towards moderating the pace of quantitative tightening (QT) during its upcoming policy meeting. QT involves scaling back the Fed's substantial securities holdings, accumulated to bolster the economy previously. A definitive strategy for this slowdown is expected by mid-year, underscoring that the impact of where QT ultimately ends is more critical than the rate at which it proceeds.

Kenneth Rogoff, a Harvard University economics professor, voiced concerns over the potential for both President Joe Biden and Donald Trump to significantly increase US debt. Speaking on Bloomberg Television's Wall Street Week, Rogoff criticized the casual stance of Washington towards national debt, cautioning against the expectation that the era of ultra-low interest rates will return. Despite the difficulty in pinpointing a debt ceiling, with projections suggesting federal debt could rise to 116% of GDP by 2034 from today's 99%, Rogoff emphasizes the impending challenges of maintaining such high debt levels.

Wall Street's economic forecasters, who were once bracing for a recession, have largely reversed their predictions—a shift that raises eyebrows among some market veterans. This newfound optimism is eerily similar to the mood in 2007, just before the financial crisis, according to Albert Edwards of Societe Generale. Despite recent stock market highs and strong data on nonfarm payrolls and GDP, Edwards cautions against letting these bright spots overshadow weaker economic signals.

Gold's journey has hit a new milestone, soaring to an all-time high of $2,195 this week. But gold in America has a troubled past...

At the end of 2022, investors all around the world who had bet big on cryptocurrency and had their cryptocurrency stored by the crypto exchange, FTX, received bad news. Sam Bankman-Fried and other leaders of the exchange had been using cryptocurrency that was supposedly stored by the exchange to make bets on financial markets. And the FTX leadership was bad at trading and racked up huge losses. FTX declared bankruptcy and many of FTX leaders were convicted of financial crimes. For the investors of FTX, it was a painful experience that came from betting on cryptocurrency and the viability of crypto institutions that managed such assets. Expected losses were claimed to be in the billions.

Reuters this week reported that the divergence between IEA and OPEC demand numbers is the largest in 16 years. The IEA predicted last year that oil demand would peak before 2030. OPEC has a vested interest in stronger global demand, so there may well be an overestimation bias in its outlooks.

JPMorgan Chase & Co. tags gold as its top commodity pick, forecasting a potential surge to $2,500 per ounce this year, fueled by market enthusiasm. Natasha Kaneva, the bank's lead commodities researcher, highlighted the metal's recent peak at $2,195.15, suggesting a climb to $2,500 is within reach if inflation moderates and job growth stabilizes. Additionally, the Federal Reserve's expected shift to a more accommodative monetary policy could further elevate gold's attractiveness against yield-generating investments, pending evidence of inflation aligning closer to the Fed's 2% goal.

In a significant move, India has now permitted its Reserve Bank (RBI) to import gold without incurring import levies, a late Tuesday government notification revealed. Traditionally, gold importers in India, the world’s second-largest consumer of the metal, face charges like the basic customs duty and Agriculture Infrastructure and Development Cess (AIDC). The RBI's gold reserves stood at 800.79 metric tonnes as of September 2023, with holdings both within the country and abroad, highlighting the central bank's substantial investment in gold.

Gold's price soared to an unprecedented $2,195 per troy ounce, marking a significant breakout from its decade-long stagnation. This rally, partly fueled by a buying spree from China, is also getting a boost from traditional market drivers aligning favorably. With these factors in play, gold's journey to new heights is well underway, signaling a bullish trend for the precious metal.

At the MIPIM property conference in Cannes, Brookfield Asset Management's Bradley Weismiller revealed a striking issue: the U.S. office market is now the most oversupplied globally. According to Weismiller, this imbalance is a product of excessive construction in certain areas, coupled with a shift in how these spaces are utilized. He highlighted that the U.S. market's overexpansion and its impact on property investors, who are now grappling with heightened levels of debt, underscore a pressing need for strategic reassessment in the real estate sector.

JPMorgan CEO Jamie Dimon suggests the possibility of a US recession remains, advising caution against prematurely cutting interest rates. Speaking at the Australian Financial Review Business Summit, Dimon noted that while a "soft landing" is anticipated by many, he believes its likelihood is significantly lower, raising concerns of potential stagflation. He also mentioned the distortion of economic indicators by COVID-19, advocating for a wait-and-see approach from the Federal Reserve for clearer signals before making rate adjustments.

Morgan Stanley's oil strategist, Martijn Rats, cautions that investors might be surprised by a significant oil price rally this summer. This warning follows a recent increase in oil prices, driven by concerns over supply disruptions after drone attacks on Russian refineries and optimism that the Federal Reserve might lower interest rates, potentially boosting demand. As of midday in London, Brent crude for May delivery climbed to $83.23 a barrel, and West Texas Intermediate (WTI) for April was up at $78.95, indicating a bullish trend in the market.

Even as digital payments gain traction, counterfeit currency remains a significant issue. In 2023, the U.S. Secret Service confiscated $21.8 million in fake bills, leading to almost 200 arrests. While this figure represents a decrease from previous years ($41.5 million in 2022 and $51.4 million in 2021), the proliferation of counterfeit currency continues to pose a threat to the financial system. Beyond their well-known role in protecting high-profile officials, the Secret Service also plays a crucial part in safeguarding the nation's financial infrastructure.

February 2024 saw consumers facing persistent inflation, though slightly cooler from its peak in 2022. The Bureau of Labor Statistics reports a 3.2% annual increase in the consumer price index (CPI), with a 0.4% rise over the month, hinting at inflation's steady presence above the Federal Reserve's 2% target. Despite a more positive economic outlook among Americans, as per a Gallup survey, the cost of living continues to challenge many. This month's inflation was notably influenced by higher gasoline and shelter costs, while food prices remained unchanged, according to Bankrate’s Mark Hamrick.

Is the stock market on the brink of a major correction?

At the BMO Capital Markets 33rd Annual Global Metals, Mining & Critical Minerals Conference, WGC CEO David Tait emphasized ongoing reforms aimed at enhancing trust in the gold market. Initiatives like the Gold247 project, launched last year, seek to modernize the trading of gold, making it more efficient, transparent, and easily exchangeable.

A recent poll reveals a grim perspective among American renters on homeownership, highlighting affordability and livability issues in their areas. Despite the aspiration to own a home one day, a significant 61% of renters fear that achieving this cornerstone of the American dream is out of their reach, feeling that no matter their effort, homeownership remains an unattainable goal.

Mortgage demand climbed this week, following a drop in interest rates to 6.84% from 7.02% for 30-year fixed-rate loans. Refinancing applications jumped 12%, showing a 5% increase from the same period last year. Meanwhile, home purchase applications grew by 5% week-over-week, though they remain 11% lower than last year's figures.

Economists warn of possible layoffs as firms grapple with rising interest rates. Despite current strong job market indicators, David Rosenberg of Rosenberg Research anticipates a hiring slowdown, projecting unemployment could reach 5% by year-end. This reflects underlying economic vulnerabilities masked by seemingly robust employment figures.