Windfall Pit, Eureka, Nevada
“However, renewed U.S. dollar strength with the euro dipping below the key $1.13 level this morning blunts the bullish trend relative to equities,” Baker said. “This morning gold and the S&P 500 are tracking lower together on concerns about slowing global growth and interest rate uncertainty. I believe it likely the dollar countervailing force will continue next week to drag gold to the $1,225 level, with silver following to $14.40 per ounce.”
Further, he said, 10-year real rates are creeping above 1% even though the 10-year Treasury has fallen below 3%. “This is because inflation expectations are below 2% on a 10-year basis, canceling the normally bullish influence of lower interest rates on gold price -- another headwind for higher gold prices in the near term,” Baker said.[Full report can be found below]
Keep the faith! Gold will head back up the stairs before year's end.
- Freeport is a victim of the U.S.-China trade tensions which are prompting them and other mining companies to defer investments in new projects, and “that will add to this impending supply gap situation for the industry.”
- He also noted that speculators are bearish about copper “due to macro-drivers, and this is having a significant impact on price.”
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