Gold
Last week was packed full of economic news and capped off with a normal announcement from the Federal Reserve Chairman. Gold languished in a tight trading range while the markets digested the meaning and accuracy of the reports. Opening at $2,338.02 and closing down 1.5% to $2,301.93, the highs and the lows were not much to talk about. The big story is the resilience of the yellow metal following the huge run of $600.00 per ounce since October 2023. Some expected a 10 -15% correction. It seems 5% is all but over. Most analysts are pointing to Russia and China as the strength behind the rise and the minor pull back off of the all time high. At least one columnist is reporting that the discussion to launch the new Gold backed BRIC alliance currency (GBRIC) will commence later this month in Russia. The same individual advises that the GBRIC may be launched as a CBDC and the amount of Gold behind it could be as much as 60,000 Metric Tons. In comparison, the United States is the largest “reported” holder of Gold at 8,500 Metric Tons.
Silver
Silver continued its slide following the impressive attempt to breach the $30.00 level. Opening at $27.22 and closing at $26.56, it is unclear whether this drop was coattail effect from Gold’s lackluster performance, or more pressure from the Bears to distance the spot price from the all-important psychological level of $30.00. Physical Silver premiums have begun to creep up at the big box internet stores with Silver American Eagles bringing prices as high as $38.00. For fear of sounding like a broken record, acquiring Silver at these levels is a gift from the markets.
Platinum And Palladium
The Platinum Family of metals was split on the week with Platinum gaining and Palladium waning. Platinum opened at $918.11 and closed at $957.80 after a 4% gain for the week. Palladium was less fortunate, losing 2% after opening at $961.21 and closing at $941.88. The biggest news in this sector is that Goldman Sachs has agreed to an undisclosed settlement to a decade-long lawsuit charging the financial firm with conspiracy to rig benchmark pricing on Platinum and Palladium.
Conclusions
There are times in all markets when the wind drops and there is no clear direction. Gold and Silver have been trying to break out of the pack by signaling trouble on the horizon. The three most important factors in the future of precious metals pricing are the Dollar, interest rates, and wars. The calm before the storm is an eerie feeling knowing that something is coming, but it seems impossible to have a peaceful and tranquil life right now. The long-awaited announcement about the Gold Backed Currency in the form of a Central Bank Digital Currency touted by the BRICS alliance has been beta tested and the release will be debated in Russia May 14 – 19. This should take care of the Dollar. There are multiple wildcards involved in the Middle East War. The BRICS and the rest of the free world will draw the battle lines in whatever the war in Ukraine expands into. The Federal Reserve cannot afford to raise interest rates, nor can they afford to lower them. Inflation is neither transitory or ending. Inflation is stubbornly growing and putting us in danger of stagflation. There is never a bad time to buy Gold and Silver. But, some times are better than others.
