Commodity Trade Mantra

Posts Tagged ‘Interest Rates’

Is Gold still a Buy? - 5 Reasons You Should Increase Allocation to Gold

Gold is up almost 8% since the beginning of the year & the outlook for 2017 is bright. Net bets on higher future prices have almost doubled since January. Assets held by gold ETFs are up 34% from their Dec lows. Given its recent surge, is gold still a “buy?” Here are 5 compelling Reasons. Given the uncertain outlook & improving fundamentals for gold, now is a great time to add gold to your portfolio.

Gold Preparing for a Healthy Rally into Higher Territory

Hedge funds and institutional speculators have been calling the tune for gold, trading the recent range, buying on dips, selling on rallies, and gradually adding to their physical holdings – a behavioral pattern we expect will continue within a rising trading range – at least until a price above the $1300 an ounce level is well established.

The Real US Economy - A Full-Fledged Credit Crisis Is Inevitable

Americans are filing bankruptcy at the fastest rate in years… A growing number of U.S. businesses are going bust… The value of U.S. auto loans topped $1 trillion for the first time ever. Outstanding credit card debt has also surged to record highs. The value of student loans has doubled since 2009. All this wouldn’t be such a big problem if the economy were doing well… But it’s not.

Is Trump Bad News for Gold? The Prospects for Gold under President Trump

Trump or not, the fundamental problems remain deep seeded in the US economy. “Draining the swamp” and “making America great again”, are easier said than done. This is why a serious investment into gold is for the long haul. Look beyond the short-term speculations & projections. Its clear that conditions will not be favorable either way & things appear increasingly dismal.

The Stock Market Crash Will Be Violent - Its Only a Matter of Time

Coming soon, is the mother of all debt ceiling crises that will finally demolish the notion that Trump is good for the economy & the stock market. Fed has destroyed honest price discovery, & so the stock market has no braking or correction mechanism & will drift higher on buy-the-dips momentum until it hits a sharp object – the most dangerous market mutation to have been confected by state policy.

Gold Bulls to Take Comfort in the Long Term

Expectations of higher interest rates, an appreciating dollar & record-high equity prices held gold prices down. But the longer-term outlook is another story! Contrary to the disappointing experience of 2016, the price of gold is likely to zoom much higher in the years ahead, perhaps doubling or even tripling from recent lows by the end of president-elect Trump’s four-year term.

Silver Price Forecast: The Factors Influencing Silver Prices in 2017

While the second half of 2016 was not kind to silver prices, there are more than enough reasons to be bullish on silver in 2017. If there’s one thing that silver and gold bugs understand, it’s that economic uncertainty is good for precious metal prices. Finally, one has to wonder what the silver price-fixing allegations will have on silver prices in 2017.

Gold, Investor Optimism & Price Inflation Outlook for 2017

The effect of price inflation is not, as commonly supposed, to drive up prices. Instead, it drives down the purchasing power of expanding government-issued currency. Awareness that money is losing purchasing power only dawns on the public late in the price inflation process. Gold is therefore a far better measure of currencies’ loss of purchasing power than government inflation measures.

Gold Price Outlook Hostage to Uncertain Trump & India

Things didn’t quite pan out the way gold bulls would have hoped, and now they face a new year where the price of the precious metal is likely to be hostage to developments that are inherently unpredictable. The two main risks for the gold outlook for 2017 are what actually happens in the presidency of Donald Trump & how the demonetization of India plays out.

Why Gold Prices Could Bottom "On or Close to", After Fed’s Rate Hike

The Fed rate hike could mark an intermediate bottom in gold prices. We could see a knee-jerk move lower on a Fed rate hike, followed by a sharp move higher marking a gold bottom on the CPI numbers. And in the background we have naturally rising interest rates, which, if they continue, will make servicing what is nearly a $20 trillion debt harder and harder.

US Dollar & Geopolitical Uncertainty will Drive Gold Prices Higher

Potential US dollar weakness & geopolitical uncertainty could drive gold prices higher next year. The response to stagnant growth and higher debt levels could eventually lead to higher inflation, which will ultimately be positive for gold prices. It doesn’t really matter what the specific catalyst will be. Gold surely has the potential to move higher.

"Too Many Promises That Can't be Kept" - The Fed Can't Raise Rates: Paul Volcker

One can’t really blame the government for continuing its debt-funded spending spree – despite protests to the contrary – after all rates are so low, it would be irrational not to take advantage and add on more debt. However, it is here that the punchline from the Volcker op-ed kicks in, and explains why the Fed is stuck and will find it next to impossible to hike rates.

Is Gold and Silver Bull Market Intact or will US Dollar Strength Crush it?

Conventional wisdom would tell us with the US$ index nearing a major breakout, gold and silver would be vulnerable to further losses. Ultimately, as long as Gold and silver’s fundamental driver – declining or negative real interest rates remain in place, then the fledgling bull market will remain on track. With inflation poised to rise, real rates are likely to decline further in 2017.

The Major Catalysts That Influence Gold Prices

Physical gold had its best quarterly gain in 30 years during the first quarter, and year-to-date, even with its recent swoon, physical gold is higher by roughly $200 an ounce. Gold has firmly reestablished itself as being in a bull market. The factors that move gold prices are largely unknown or overlooked. Let’s have a look at the seven most common factors that influence physical gold prices.

How Will the Election Outcome Impact Gold and Silver?

The looming national bankruptcy coincides with this year’s extraordinarily divisive election. As the trust and prestige of our Federal government fades, the potential for social unrest and even wrenching change in governance and policy is on the rise. If crisis is coming in the next presidential term, the people holding physical gold / silver will almost certainly be glad they did.

Inflation - Difficult to Move, But Once Moving, Hard to Control

Three key measures of inflation have recently lurched across the Fed’s threshold of 2%. The recent pickup in gas prices is set to have an even sharper upward impact on the consumer price inflation basket. Inflation can really spin out of control very quickly. If it happens, it would happen very quickly. Inflation is like a supertanker: Hard to get moving. But once moving, hard to stop.

Price of Gold Could Rise a Lot Higher - In Fact Double

There’s a difference between the narrative, which is what you’re being told, versus the reality of the economic data. It’s in no one’s interest ahead of the election to say the U.S. economy is a mess. If the flood of bad economic data continues, the Fed will almost certainly print more money or cut interest rates. And that could easily send the price of gold through the roof.

The Fed’s Missed Window To Hike Rates & Failed Realizations

What is clear is the Federal Reserve should have chosen to increase rates long ago where such tightening of monetary policy would have been somewhat offset by the continued floods of interventions. The window to lift interest rates appears to have closed which could potentially be a policy nightmare. Eventually something has to give & it will likely not be the outcome the Fed hopes for.

Silver and Gold Prices Supported by Weak Dollar - Rally Stalls Abruptly

A continuation of the defensive dollar tone over the past 24 hours, coupled with downward pressure on bond yields, has continued to provide underlying support to silver and gold prices. Analysts warn that continued upside for gold futures may be limited now that a Dec rate hike is firmly in play. According to Fed Fund futures, traders are pricing in a nearly 60% chance of liftoff by year-end.

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