Gold and Silver Is up This Week. Why? [Global Nuggets Newsletter]
They Say a Week’s a Long Time in Politics – It Is in Precious Metals Too. Gold and Silver Is Up This Week. Why?
Global Nuggets
15/08/2022
Just two weeks ago, I wrote that the US was in recession, and inflation was shooting up. Gold and Silver would be hit, albeit short-term. Last week, US economic data was released that turned the tables on what we’ve seen over the past few months. Data showed that there was 0% inflation in the US in July, or an annual rate of 8.8%, down on the previous month. Does this mean inflation peaked in the US following four FED interest rate rises? Will economic strategies change as a result of this news? Given the strong dollar and dire financial news globally, does this mean that we have turned a corner? Let’s see. Gold has risen over the past four weeks and, importantly, has hovered around US$1800 for much of last week.
Why Is This a Good Sign?
Because the price is stabilizing at this level rather than falling back, despite the strength of the US dollar. The ‘futures’ price for gold has risen to US$1818 for December 22, slightly up from last week. Interestingly, Kitco, the Canadian-based precious metals news hub, ran a survey among retail traders as to whether they see the market moving positively or negatively in the next few months – with 42% of 216 respondents being bullish for gold versus 28% who take a more bearish (cautious) approach. There was more positive news for the yellow metal from Maxime Bernier, the founder of the People’s Party of Canada. Bernier was a minister in the Conservative Party of Canada for 14 years. He has strong views on the new world order and one where gold plays a central role. He argues that a global monetary reset is due as fiat currencies are hit by excessive money printing (fiat currencies are government-issued currencies, such as the dollar or euro). He continues, by stating that a commodity-backed money system is inevitable, with gold central to this, as was the case during the time of the Gold Standard. Interesting views on gold.
Silver
As for silver, the corner seems to have been turned too, and although gold has risen the past few weeks, there has been a greater gain from the white metal since July 21st. Silver is a highly speculative market, and its outperformance indicates that investors and traders are moving capital into this precious metal. At the end of last week, the September ‘futures’ was at US$20.70 per ounce, considerably higher than the mid-July mark. Now is a great time to buy both gold and silver.
This Week's News
Here are a few nuggets from the world of precious metals this week:
US Inflation numbers surprise analysts by dropping in July
https://www.reuters.com/markets/us/us-import-prices-fall-more-than-expected-july-2022-08-12/
Gold will play a central role in the global reset
Gold holds around US$1800 as the prices stabilize – for now
Silver making a comeback
https://www.barchart.com/story/news/9667571/silver-makes-a-comeback