Gold and Silver Industry & Investing News
Today’s gold and silver market news, curated from the best of GoldSilver's team and around the web. Everything precious metals investors need to know including updates on big price swings, macro analysis, and breaking stories. Check back often or subscribe to get the highlights in your inbox. Monitor live spot prices on our charts page.
Subscribe
Metal Markets Brace for Reshuffling as US Tariffs Target Key Allies
As President Trump's new metal tariffs take effect, U.S. companies are orchestrating a major pivot in their supply chains away from traditional North American partners toward Middle Eastern and South American sources. The 25% tariff on Mexican and Canadian imports, along with a 10% levy on Chinese goods, is forcing a particular reshuffling in the aluminum sector, where Canada currently supplies 56% of U.S. imports – about 3.08 million metric tons annually. Industry analysts predict significant price increases, with the U.S. Midwest premium potentially doubling to 50 cents per pound. Major producers like Alcoa are exploring plans to redirect Canadian materials to Europe while increasing imports from the UAE, Bahrain, and India. Beyond aluminum, the copper and silver markets are also bracing for change, with Peru and Chile emerging as likely alternative suppliers. However, industry experts advise caution, noting the possibility of tariff expansion to other jurisdictions and the potential for broader trade policy shifts.
READ MOREPhysical Gold Rush Hits NY Markets Ahead of Potential Tariffs
A dramatic surge in physical gold demand is reshaping precious metals markets as traders scramble to secure bullion ahead of President Trump's potential 25% tariffs. This has pushed gold prices to an all-time highs and creating notable price disparities between London and New York markets, with spreads reaching up to $50 per ounce for gold and 90 cents for silver. The situation has become particularly acute in the last two weeks, with Comex warehouse stocks jumping 30% to 30.4 million ounces as traders move to protect themselves against possible tariff implementations. The rush has created significant pressure on traditional market dynamics, with London's bullion market experiencing strain as physical gold flows to New York. While the Bank of England maintains there is no shortage of gold, they acknowledge longer wait times for vault transfers due to unprecedented demand. Market experts suggest this could lead to a potential short-covering event, given that paper trades significantly outnumber physical holdings. The situation is particularly concerning for silver, which relies heavily on imports from Mexico and Canada. This market upheaval reflects broader uncertainty about the scope of upcoming tariffs and their potential impact on precious metals prices, with some analysts suggesting gold prices could reach $3,500 if tariffs are implemented.
READ MOREFed's Inflation Target Remains Elusive as PCE Hits 2.6% in December
December's PCE data reveals a concerning trend in U.S. inflation, with the headline rate climbing to 2.6%, its highest point in seven months and a significant deviation from September's 3½-year low of 2.1%. The monthly increase of 0.3% was the largest since April, though core PCE, which excludes volatile food and energy prices, remained stable at 2.8%. This persistent inflation, combined with a robust economy and strong labor market, has led the Federal Reserve to maintain higher interest rates, with officials suggesting rate cuts may be further delayed. The inflation outlook is complicated by multiple factors, including the Federal Reserve's updated forecast showing PCE inflation at 2.5% by the end of 2025, still above their 2% target. Adding to the uncertainty are the new Trump administration's policies, particularly regarding trade and immigration, which could put upward pressure on prices. Fed officials, including Chair Powell and Governor Bowman, acknowledge the potential for continued inflation pressures while remaining cautious about the impact of upcoming policy changes, such as the planned 25% tariffs on Mexican and Canadian imports. This complex economic environment suggests a challenging path ahead for achieving the Fed's inflation target and normalizing monetary policy.
READ MOREBeyond Interest Rates: Gold's Price Finds New Drivers
Gold's price dynamics have undergone a fundamental transformation since 2022, breaking its long-standing correlation with real interest rates as the precious metal surges to record highs of $2,798 per ounce. This structural shift began with Russia's invasion of Ukraine and the subsequent Western sanctions, which prompted many central banks to reconsider their dependence on US dollar reserves. China has emerged as a key player in this new landscape, becoming the largest central bank gold buyer in 2023 and experiencing a 150% surge in gold ETF investments amid domestic deflation concerns. The changing dynamics reflect broader global tensions and financial system fragmentation. US fiscal policy has become a significant factor, with high deficits and uncertain trade policies under Trump creating inflationary pressures and pushing bond term premiums to their highest levels since 2011. The World Economic Forum has highlighted growing concerns about nations weaponizing the global financial system for geopolitical objectives, leading to increased gold demand as a hedge against system fragmentation. This combination of geopolitical rivalry, fiscal uncertainty, and financial system stress has created a new paradigm for gold pricing that extends beyond traditional interest rate relationships, suggesting a potentially sustained bull run even if geopolitical tensions ease.
READ MORELondon's Gold Pool Shrinks: Banks Scramble as US, China Drain Supply
London's gold market is facing a critical transformation as its traditional role as the global gold trading hub comes under pressure from multiple directions. The crisis stems from a surge in US-bound gold shipments coinciding with China's ongoing accumulation, creating a two-way drain on London's physical gold reserves. This situation has exposed the fragility of the long-standing bullion banking model, which relied on readily available gold for leasing and trading. The market strain is evidenced by extended wait times at the Bank of England and diminishing liquidity in London's over-the-counter trading. The crisis reflects a deeper shift in the global gold market structure, where traditional financial trading is giving way to physical possession priorities. Major nations, including China and Russia, have been steadily accumulating physical gold while reducing their exposure to US bonds, effectively removing substantial portions of gold from the leasing pool. This transformation is further complicated by gold's elevated Tier 1 status and growing recognition as a strategic asset rather than merely a financial instrument. With only about 300 million ounces of London's estimated billion-ounce stockpile available for trading, the market faces a fundamental restructuring as banks and nations compete for an increasingly scarce pool of leasable gold.
READ MOREGlobal Currencies Shift: Japanese Yen Leads While Dollar Steadies
January 2024 has marked a significant shift in currency markets, with the Japanese yen leading gains and set for its best January since 2018, appreciating 1.6% despite some late-month weakness. This strength comes from growing expectations of further Bank of Japan rate hikes, supported by Tokyo's core inflation hitting 2.5% and positive signals from BOJ officials. Meanwhile, North American currencies face uncertainty as President Trump's February 1 deadline for imposing 25% tariffs on Mexican and Canadian imports approaches. The Canadian dollar has touched five-year lows, while the Mexican peso is experiencing its worst weekly performance since October. The broader currency landscape shows mixed signals, with the ECB cutting rates and leaving room for further easing, while the Federal Reserve maintains a cautious stance on rate cuts. The dollar index, though firm ahead of the tariff deadline, is headed for a monthly loss of 0.3%.
READ MOREOil Market Tense: 25% Canada Tariff Decision Pending
Oil prices remained steady near $73 as markets await President Trump's decision on whether to include crude oil in the planned 25% tariffs on Canadian and Mexican imports. This decision carries significant implications for the North American energy landscape, particularly given the deep integration of US-Canadian energy markets and Canada's substantial 4 million barrel per day export to the US. Industry experts, including Goldman Sachs analysts, warn that implementing oil tariffs could trigger higher gasoline prices in the US Midwest while eventually depressing global crude prices through weakened demand. The situation has sparked preparation for potential retaliation from Canada, which has drafted a $105 billion list of US products to target and is considering more aggressive measures, including export taxes on strategic commodities. Despite these tensions, crude is still positioned for a modest January gain, though recent advances from US sanctions on Russia and cold weather have been partially offset by Trump's tariff threats and his pressure on OPEC to increase production.
READ MORETariff Fears Trigger Massive Gold Flow from Switzerland to US
December saw a dramatic shift in global gold flows as Switzerland, Europe's primary refining hub, exported 64.2 tons of gold to the United States – the highest volume since Russia's invasion of Ukraine and an eleven-fold increase from November levels. This surge, valued at nearly $6 billion, was primarily driven by traders' concerns about potential tariffs and their rush to cover short positions. The movement created significant market dynamics, with Comex gold futures trading at premiums exceeding $50 an ounce over London spot prices, creating profitable arbitrage opportunities. The ripple effects of this shift were felt in other markets, with Swiss exports to the UK also jumping thirteen-fold to 14 tons, while simultaneously tightening supply in London's bullion market. Despite these dramatic increases in Western-bound shipments, overall Swiss gold exports actually decreased by 4.5% to 123 tons, marked by notable declines in exports to traditional major buyers China and India.
READ MORETrump Threatens 100% Tariffs if BRICS Challenges Dollar Dominance
President Trump has escalated his stance against BRICS nations' currency ambitions, threatening to impose 100% tariffs on countries that attempt to challenge the US dollar's global dominance. This warning, posted on Truth Social, mirrors his November statement and comes at a crucial time when BRICS membership has expanded to include Egypt, Ethiopia, Iran, the UAE, and most recently, Indonesia. The bloc's discussions about an alternative currency system have gained momentum following Western sanctions on Russia, though these remain preliminary. This development intersects with Trump's broader trade strategy, including pending decisions on 25% tariffs against Mexico and Canada, which he's leveraging to address drug trafficking and immigration concerns. Despite BRICS' growing influence, the Atlantic Council's research confirms the dollar's continued supremacy in global markets, bolstered by US economic strength, tight monetary policy, and geopolitical factors.
READ MOREGold Passes $2,800 Mark as Trade Tensions Drive Safe-Haven Rush
Gold prices hit a historic high of over $2,800 as investors sought safe-haven assets amid escalating trade tensions. The precious metal gained over 6% this month, driven by President Trump's renewed threats of 25% tariffs on Mexican and Canadian imports. Market experts, including WisdomTree's Nitesh Shah, suggest this rally could maintain momentum as long as trade policy uncertainty persists. Adding to gold's appeal, central bank buying remains a strong structural force in the market, while mixed economic signals - including slowing GDP growth but increased consumer spending - continue to support precious metals. With the Federal Reserve closely monitoring inflation and employment data, and Indian physical demand temporarily subdued due to high prices, analysts like ActivTrades' Ricardo Evangelista suggest gold could potentially reach $3,000 if high inflation and sluggish growth conditions prevail.
READ MOREGold Breaks $2,800 Ceiling Amid Trade War Tensions
Gold prices surged to a historic peak above $2,800 per ounce, driven by a perfect storm of market uncertainties. President Trump's announcement of impending 25% tariffs on Mexican and Canadian imports, coupled with additional threats toward China, has intensified fears of a broader trade conflict. This market anxiety, combined with concerns about US fiscal policy and potential inflationary pressures from tax cuts and immigration reform, has propelled investors toward safe-haven assets. The Federal Reserve's decision to hold interest rates steady and adopt a wait-and-see approach, along with anticipated inflation data, has further supported gold's appeal. The precious metal's fifth straight weekly gain underscores persistent market unease about global economic stability and trade relations.
READ MOREFed Holds Rates Steady as Trump Fumes Over Powell's Patience
The Federal Reserve voted unanimously to maintain interest rates at 4.25-4.50%, signaling a pause in its recent rate-cutting cycle amid uncertainty over President Trump's economic policies. Fed Chair Powell emphasized there's "no hurry" to adjust rates unless labor markets weaken or inflation pressures ease, prompting an angry response from Trump on social media. The decision reflects the Fed's cautious approach as it evaluates the potential impact of proposed tariffs and fiscal policies on inflation and employment.
READ MOREHousing Market Cools as 7% Mortgage Rates Deter Buyers
Mortgage application volume declined 2% last week despite steady interest rates at 7.02%, reflecting continued weakness in housing market demand. Refinancing applications dropped 7% week-over-week, while purchase applications fell 0.4%. Despite ending 2024 on a positive note, current mortgage rates remain significantly higher than last year, limiting opportunities for both new buyers and refinancing homeowners.
READ MOREBank of England Gold Queue Grows as US Tariff Fears Drive Market Shift
London's bullion market is experiencing significant strain as banks rush to borrow gold from central banks following a massive flow of metal to the United States. Over two months, COMEX warehouse stocks increased by 12.2 million ounces (70%), driven by fears of potential US import tariffs. This has led to unprecedented delays at the Bank of England, with minimum waiting times for gold withdrawals extending to four weeks, compared to the usual few days.
READ MORETreasury Yields Drop as Markets Await Key US Economic Data
Treasury yields declined across the curve Thursday, with the 10-year rate falling to 4.50%, as investors await crucial US economic data following the Federal Reserve's noncommittal stance on future rate cuts. The market's attention has shifted to upcoming GDP and inflation figures for policy guidance, while the European Central Bank is expected to cut rates amid economic struggles in the eurozone. The divergence between Fed and ECB approaches highlights the different economic challenges facing the two regions.
READ MOREECB Expected to Slash Rates to Two-Year Low Amid Economic Concerns
The European Central Bank is expected to reduce its deposit rate from 3% to 2.75%, marking the lowest level in nearly two years, as inflation continues to moderate and economic growth remains sluggish. While inflation stands at 2.4%, above the ECB's target, it's projected to decrease to 2.1% this year. The eurozone faces mixed economic signals, with core economies like Germany and France struggling while peripheral nations benefit from tourism, leading to a modest growth forecast of 1.1% for 2024.
READ MOREGold Rallies to $2,778 as Fed's Powell Signals Policy Pause
Gold prices advanced to near-record levels around $2,778 per ounce, benefiting from a 0.1% decline in the dollar following the Federal Reserve's latest policy meeting. The precious metal's strength comes despite Fed Chair Powell's hawkish stance, where he emphasized the central bank won't rush into rate cuts and needs to see further progress on inflation. Market expectations for rate cuts have significantly shifted, with swap traders now pricing in only 50 basis points of cuts for the year, while some investment banks are forecasting no cuts at all. The metal's resilience is particularly notable given the complex economic backdrop, including potential Trump administration policies on tariffs and taxes that could stoke inflation. Traders are now focused on forthcoming fourth-quarter GDP data for additional insights into the US economic trajectory, while other precious metals including silver, platinum, and palladium also showed gains in London trading.
READ MOREDespite Fed Moves, Borrowing Costs Remain Stubbornly High for Most Americans
The Federal Reserve's recent rate-cutting cycle has failed to provide the financial relief many Americans anticipated, creating a stark disconnect between monetary policy and consumer reality. Despite a full percentage point reduction in the Fed's benchmark rate since September 2024, consumers face a challenging environment where borrowing costs remain elevated across multiple sectors. Mortgage rates continue to hover around 7%, vehicle financing remains expensive with new car loans at 6.8%, and credit card APRs have shown only minimal decreases. The situation is particularly dire for millennials, who represent the largest share of home buyers and are in their prime borrowing years, with 82% reporting significant financial impact from high rates. The lack of relief stems from several factors, including the complex relationship between Fed policy and consumer lending rates, persistent inflation, and broader economic conditions. Long-term rates, which govern mortgages and car loans, are tied more closely to 10-year Treasury yields than to Fed policy. Additionally, about 73% of current homeowners are insulated from rate changes due to their existing low-rate mortgages secured during the pandemic, creating a divided impact on the housing market. Experts predict little improvement through 2025, with Fannie Mae forecasting mortgage rates to end the year at around 6.5%, suggesting continued challenges for consumers seeking affordable financing options.
READ MOREUS Gold Imports from Switzerland Surge 1,100% on Trade Concerns
Swiss gold exports to the United States rose dramatically in December, jumping eleven-fold to 64.2 tons – the highest level since March 2022. The surge, valued at nearly $6 billion, was driven by traders rushing to secure bullion ahead of potential tariffs. The market response was immediate and significant, with Comex gold futures commanding premiums exceeding $50 an ounce over London spot prices, creating profitable arbitrage opportunities. The ripple effects extended beyond the US market, as Swiss gold exports to the UK simultaneously surged more than thirteen-fold to 14 tons, while total Swiss exports actually decreased by 4.5% to 123 tons due to reduced shipments to Asian markets. This unprecedented movement of precious metals highlights how trade policy uncertainty can rapidly reshape global commodity flows and create significant market dislocations.
READ MOREFed's Powell Maintains Rate Stance, Brushes Off Political Pressure
Federal Reserve Chairman Jerome Powell maintained a steady course at the January meeting, keeping interest rates between 4.25% and 4.50%. Amid political pressure and uncertainty around potential tariffs, Powell emphasized a data-driven approach, declining to comment on presidential statements or speculate about future policy changes. This measured stance suggests the Fed may hold off on rate cuts through 2025, particularly if new tariffs drive inflation back to 3%.
READ MORE