Welcome back to our weekly precious metals market update, where we provide you with a comprehensive overview of the performance of gold, silver, platinum, and palladium. Whether you are a seasoned investor or someone considering precious metals as an investment option, this update will equip you with valuable insights into the recent performance of these timeless assets.
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Gold Markets
Gold fell in the early week trading from $2,049.86 to $2,005.67 by Thursday followed by a nice rally on Friday to close at $2,029.72. Another conflict in the Middle East between Iran, potentially a Nuclear Power, and Pakistan, a known Nuclear Power ignited the geo-political conflict positive characteristic of Gold yet again. Pakistan is now the 9 th nation to see cross-border conflict in the Middle East Region since southern Israel suffered the atrocities delivered them by Hamas in early October.
The early week’s drop is largely attributed to the December Retail Sales Report that came in higher than expected. Once again, the investment sentiment seems to be turning to the actions of the Federal Reserve regarding interest rates. At the end of December, it was a 90% bet that interest rate increases would at least remain halted to cut at the next meeting in March. Today that bet is 50% / 50% at best.
While Gold is holding its ground against the equity markets, it should be considered a safe haven in the event that stocks begin to retreat due to economic and geo-political pressure. History shows that in events such as 2001 and 2008, Gold’s long winning streak would serve as a launching pad as investors seek shelter in alternative investments.
Silver Markets
As has recently been the case, Silver matched Gold nearly step by step early in the week but separated towards the end. Unable to sustain the late week rally like Gold, the close on Friday was the low for the week. Opening the week at $23.19 and stumbling home to a disappointing $22.62 at the close on Friday afternoon. Silver is currently off 16% from its 12-Month high. Close attention should be paid to when the profit taking is completed and the rally resumes. While Silver has been a tool for the ultra-rich and institutional investors, its grass roots popularity comes from Middle Class America.
The contraction of some Physical Silver Premiums from their 12-month highs would indicate that Bidenomics is affecting the disposable income of that sector. While still high, premiums are lower than this time last year. Generic Bars are hovering between 25% & 28%, While Silver American Eagles remain proud at 35% & 40%. Down considerably from early 2023.
Platinum/Palladium Markets
As has recently been the case, Silver matched Gold nearly step by step early in the week but separated towards the end. Unable to sustain the late week rally like Gold, the close on Friday was the low for the week. Opening the week at $23.19 and stumbling home to a disappointing $22.62 at the close on Friday afternoon. Silver is currently off 16% from its 12-Month high. Close attention should be paid to when the profit taking is completed and the rally resumes. While Silver has been a tool for the ultra-rich and institutional investors, its grass roots popularity comes from Middle Class America. The contraction of some Physical Silver Premiums from their 12-month highs would indicate that Bidenomics is affecting the disposable income of that sector. While still high, premiums are lower than this time last year. Generic Bars are hovering between 25% & 28%, While Silver American Eagles remain proud at 35% & 40%. Down considerably from early 2023.
Palladium opened at $977.55 and closed at 951.54. With Electric Vehicles increasing sales in 2023, a surplus in Palladium and Platinum stockpiles occurred as the auto industry uses the two for emissions control units. The stockpile must be reduced, and fossil fueled vehicle sales must increase in order to see any movement in this family of metals.
Outlook and Conclusion
The Wall Street Journal got on the political campaign trail last week to attempt to “gaslight” Americans along with the incumbent administration. The headline “It Won’t Be a Recession----It Will Just Feel Like One”. If there was an impartial American mainstream media, this article would be lambasted. Americans are showing that they understand the difference between news and commentary, and facts and propaganda. The extrapolation of this article being printed at all is “if they are this bold to try to hide it, how bad is going to be?”
There is never a bad time to buy Gold and Silver. But some times are better than others.
Sincerely,
Doug Pullen
President - CEO
