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
Treasury Yields Near 5% as Global Bond Selloff Intensifies
The global bond market is facing a dramatic reset as yields surge across major economies, led by the $28 trillion US Treasury market. Just days into 2025, yields have climbed significantly, with the 10-year Treasury rate rising over a percentage point in four months and approaching the symbolic 5% level. This bond market "tantrum" reflects multiple pressures: surprisingly robust economic data, reduced expectations for Fed rate cuts, and growing concerns about US fiscal policy ahead of Trump's return to the White House. The implications are far-reaching, affecting everything from mortgage rates and corporate borrowing costs to stock market sentiment. Adding to market anxiety is the unusual disconnect between Fed policy and market yields, as rates continue rising even after the Fed began its easing cycle in September. With fiscal deficits projected to exceed 6% of GDP and expectations of Trump's growth-focused policies potentially expanding deficits further, some analysts warn of the return of "bond vigilantes" who may force a reckoning over fiscal policy.
READ MOREFed Officials Split on Rate Cut Path as Economy Shows Strength
Federal Reserve officials Michelle Bowman and Jeff Schmid have signaled a cautious stance on future rate cuts, suggesting that the benchmark rate may already be close to its "neutral" target following 100 basis points of reductions since September. Their position contrasts with other Fed officials, including Chairman Powell and Governor Waller, who maintain that rates remain restrictive. Bowman expressed particular concern about strong economic growth and a 20% rise in the stock market, warning of potential inflation risks. The differing views among Fed officials point to a potentially widening divide within the committee in 2025, with clarity on President-elect Trump's economic policies potentially helping to bridge these differences. Notably, Bowman, who is considered a frontrunner for the Fed vice chair for supervision role, also called for increased transparency in bank regulation.
READ MOREBitcoin Drops Below $91,000 as Rate Cut Hopes Fade
Bitcoin experienced a significant decline on Monday, falling 4.4% to $90,199, marking its lowest point since November 18 and a sharp retreat from December's peak of $108,316. The selloff was triggered by stronger-than-expected US employment data that reduced expectations for near-term Federal Reserve rate cuts. The cryptocurrency market's weakness extends beyond Bitcoin, with Ether dropping 6.6%, reflecting broader concerns in the digital asset space. Technical analysts note a concerning head and shoulders pattern formation, suggesting a potential trend reversal from bullish to bearish territory. While Bitcoin's 2024 rally was fueled by the approval of US exchange-traded funds and President-elect Trump's supportive stance, market enthusiasm has cooled in early 2025 as investors await clarity following the upcoming inauguration.
READ MORETech Stocks Lead Market Plunge as Rate Cut Hopes Fade
US stocks tumbled Monday, with tech leading the decline as the Nasdaq fell 1.6% and the S&P 500 dropped 0.8%. Markets reacted to diminishing hopes for interest rate cuts after strong December jobs data, with traders now expecting no cuts until September 2025. The 10-year Treasury yield reached a 14-month high near 4.8%, while the dollar surged to a two-year peak against major currencies. Adding to market pressures, oil prices climbed to five-month highs following new US sanctions on Russian crude, while the "Magnificent Seven" tech giants, including Nvidia, Apple, and Tesla, all lost ground. Investors are now closely watching Wednesday's Consumer Price Index report for further clues about the Federal Reserve's potential policy moves.
READ MOREDollar Surge Weighs on Gold, Trump Trade Policy Fears Limit Losses
Gold prices dropped 0.5% to $2,677.13 per ounce following strong U.S. jobs data that dampened expectations for early Fed rate cuts. While a strengthening dollar pressured gold prices, ongoing uncertainty around President-elect Trump's proposed trade policies and inflation concerns continued to provide underlying support for the precious metal.
READ MORE
This Gold Market Anomaly Could Spark a Major Rally
Gold ETFs are missing from the current rally - but State Street predicts their return could trigger a surge to $3,100/oz in 2025.
READ MOREDecember Fed Minutes Show Cautious Path Despite Rising Risks
The Federal Reserve's December meeting minutes show a complex policy landscape, with officials increasingly worried about inflation risks while maintaining their easing bias. Despite cutting rates for the third consecutive time to 4.25%-4.5%, there was notable discussion about inflation risks, particularly regarding incoming President Trump's proposed trade and immigration policies. While some officials advocated for holding rates steady, and Cleveland Fed President Beth Hammack dissented in favor of no cut, the committee remained open to further easing if inflation moderates and labor markets remain strong. This stance contrasts with external views, such as monetary policy expert Adam Posen's prediction that the Fed might need to start hiking rates by summer due to Trump's economic plans.
READ MOREMarkets Slash Fed Rate Cut Bets After Strong Jobs Report
Strong December employment data has dramatically shifted market expectations for Fed policy in 2024, with traders now anticipating just one rate cut in June, down from previous expectations of multiple cuts starting in May. The surprisingly robust job growth has led markets to significantly scale back their rate cut forecasts for the year.
READ MOREFed Officials Split on Rate Cut Path as Policy Debate Intensifies
Two key Federal Reserve officials have challenged the market's expectations for aggressive rate cuts, suggesting the Fed's benchmark rate may already be close to its neutral target. Kansas City Fed President Jeff Schmid and Governor Michelle Bowman both indicated that the 100 basis points in cuts since September have brought rates near their optimal long-term level, warranting a more gradual approach to future policy changes. Their stance contrasts with other officials like Chairman Powell and Governor Waller, who maintain that current rates remain restrictive. This policy divide could intensify in 2024 with new voting members joining the committee. Adding to the complexity, the Fed is waiting for clarity on incoming President Trump's economic policies before making further policy decisions. Bowman, potentially the next Fed vice chair for supervision, also called for increased transparency in bank regulation while maintaining a balanced approach to oversight.
READ MOREGold Defies Market Logic as Fiscal Fears Drive Safe Haven Buying
Gold is demonstrating strength in early 2024, defying its typical inverse relationship with dollar strength and Treasury yields. The precious metal's rise to four-week highs, despite these traditional headwinds, signals a fundamental shift in market sentiment driven by deep concerns about U.S. fiscal stability. Market experts, including Gold Newsletter's Brien Lundin, suggest that the simultaneous rise in Treasury yields, dollar strength, and gold prices reflects growing unease about U.S. debt levels and deficits relative to GDP. The Federal Reserve's potential loss of control over rates has further fueled this trend, pushing investors from central banks to individuals toward gold as the "ultimate safe haven." This shift has helped gold futures reach $2,690.80 per ounce, marking a 1.9% gain in 2024 despite conditions that historically would have pressured prices.
READ MOREUK Markets Flash Warning Signs as Bond Vigilantes Return
Bond markets are signaling growing investor unease about government fiscal policies, with the UK emerging as a focal point of concern. The situation began with a US-led global bond selloff as markets scaled back Fed rate cut expectations, but has evolved into a particular challenge for the UK, where 30-year gilt yields have hit levels not seen since 1998. The market turbulence threatens to eliminate the UK government's £9.9 billion fiscal buffer and has forced Chancellor Rachel Reeves to consider spending cuts over tax increases. This development comes as outgoing US Treasury Secretary Janet Yellen warns about the risks of "bond vigilantes" - investors who demand higher yields due to perceived fiscal irresponsibility. The situation has drawn comparisons to the UK's 1970s financial crisis, highlighting the delicate balance governments face between fiscal management and market confidence.
READ MOREMarkets Reassess Risk as 10-Year Yield Nears Critical Level
The market's relationship with Treasury yields has shifted dramatically from last year's optimistic outlook to current anxiety as the 10-year yield approaches 4.7%. This change is fueled by multiple factors: recent data showing inflation pressures in the services sector, diminishing expectations for Fed rate cuts, and concerns about incoming President Trump's potentially inflationary fiscal policies. Fidelity's Jurrien Timmer warns that inflation might not be fully contained, potentially rising to 3.5-4%, a scenario that could prevent Fed rate cuts and isn't currently priced into markets. While some experts, like State Street's Michael Arone, argue that corporate earnings should be the focus rather than Fed policy, the S&P 500's recent 2.8% pullback since its December peak, coinciding with a 50-basis-point rise in yields, suggests markets remain highly sensitive to interest rate movements.
READ MOREBrazil's New Central Bank Chief Faces Immediate Inflation Test
Brazil's inflation challenge persisted through the end of 2024, with annual prices rising 4.83%, breaching the central bank's 4.5% tolerance ceiling. While December showed a modest monthly increase of 0.52%, the underlying data reveals persistent inflationary pressures across most sectors. New central bank chief Gabriel Galipolo faces immediate challenges, as a combination of robust economic growth, fiscal uncertainties, and currency weakness threatens price stability. Despite some relief from lower housing costs, broad-based price increases in food, transportation, and services suggest mounting inflationary pressures. The situation has prompted plans for aggressive monetary tightening, with interest rates expected to reach 14.25% by March, though investors remain skeptical about the government's fiscal consolidation efforts.
READ MORE30-Year Treasury Breaks 5% as Fed Cut Timeline Shifts
U.S. Treasury markets experienced a significant selloff as December's unexpectedly strong employment data forced a major reassessment of Federal Reserve policy expectations. The 30-year yield pushed above 5% for the first time in over a year, while yields on shorter-dated Treasuries jumped more than 10 basis points across the board. This market reaction reflects a fundamental shift in rate expectations, with traders now pricing in fewer cuts and pushing the timeline for the first reduction from June to September. Since the Fed began its cutting cycle in September, yields have climbed approximately 100 basis points, suggesting that current financial conditions may not be as restrictive as the Fed previously assumed.
READ MOREU.S. Labor Market Defies Expectations with Strong December Finish
The U.S. labor market demonstrated resilience at the end of 2024, with December payrolls significantly exceeding expectations at 256,000 jobs, compared to economists' predictions of 160,000. This robust employment growth, coupled with a declining unemployment rate of 4.1%, has significant implications for monetary policy. Markets reacted swiftly, with the S&P 500 futures declining and Treasury yields jumping, as investors recalibrated their expectations for Federal Reserve rate cuts. Market strategists now anticipate sustained higher interest rates through 2025, citing both economic strength and ongoing fiscal concerns as key factors maintaining upward pressure on yields.
READ MORERobust Employment Numbers Keep Gold Rally in Check
Gold prices remained nearly flat after robust US employment data reinforced the Fed's cautious stance on rate cuts. December's stronger-than-expected job growth and lower unemployment rate suggest persistent labor market strength, potentially delaying anticipated interest rate reductions. Gold traded at $2,670.84 per ounce, trimming earlier gains as Treasury yields and the dollar strengthened.
READ MOREFed Faces Choice Between Market Stability and Trump's Rate Demands
The Federal Reserve faces a critical dilemma as bond market tensions rise: it must choose between addressing mounting inflation fears in the Treasury market or accommodating Trump's calls for lower interest rates. With the 10-year term premium reaching its highest level since 2014 and long-term yields rising despite recent rate cuts, the Fed appears likely to prioritize inflation control over presidential preferences, potentially setting up conflicts with the incoming administration.
READ MOREUK Market Turmoil Signals Return of Bond Vigilantes
The UK's financial markets are flashing serious warning signals, with gilt yields reaching levels not seen since the 2008 financial crisis and the pound dropping significantly against the dollar. This unusual combination of rising yields and falling currency typically indicates serious concerns about a country's fiscal health. While most developed economies are seeing higher bond yields due to inflation concerns, the UK's situation is uniquely concerning because it's occurring amid economic stagnation rather than growth. With £297 billion in planned bond sales and a debt-to-GDP ratio of 99.8%, the UK's predicament serves as a canary in the coal mine for other nations, particularly the US with its 120.8% debt ratio. Market analysts suggest this could signal the return of bond vigilantes - traders who target countries with perceived fiscal weaknesses - and warn that even the US's privileged position as the world's reserve currency may not protect it indefinitely from similar market pressures.
READ MORE
"I Believe Triple Digit Silver Is An Absolute" - Mike Maloney w/Alan Hibbard
In this episode of The Gold & Silver Show, Mike Maloney and Alan Hibbard break down the facts behind silver’s ongoing supply deficits and the surging
READ MOREBofA Warns Companies: Time to Hedge Against Stronger Dollar in 2025
Bank of America's G10 FX strategist Howard Du is warning U.S. corporations to adopt a more proactive hedging strategy for 2025, marking a significant shift from 2024's approach. While companies could previously afford to wait for dollar weakness before repatriating overseas earnings, the macroeconomic landscape has changed dramatically. With the dollar index at a two-year high and Trump's re-election bringing potential trade uncertainties, companies facing currency risk (particularly the 41.6% of S&P 500 revenues generated overseas) need to consider immediate hedging strategies. The bank suggests that global trade uncertainty and potential tariffs could drive further dollar strength, with current volatility pricing not yet fully reflecting these risks. The recommendation is clear: "hedge now, worry later," though mid-2025 might bring some normalization depending on tariff outcomes and fiscal policy.
READ MORE