Gold breaches the psychological $3,000 mark overnight. Spot gold tipped across that benchmark early Friday as the yellow metal continued rallying on the previous day’s haven demand.
The precious metal rallied amid ongoing concern about geopolitical and economic risk, including from U.S. President Donald Trump’s tariffs and trade policy and unrest in Ukraine, the Middle East and other parts of the world. Global markets have been volatile all week as the tariff threats and reciprocal moves by trading partners increased speculation about a possible recession. Investors were also speculating about the Federal Reserve’s plans.
April gold futures rose 1.5% Thursday to settle at $2,991.30 an ounce on Comex and the most-active contract was up 2.7% in the first four days of the week. Bullion rose 0.5% last month after gaining 7.3% in January and dropping 1.5% in December. The metal rose 27% in 2024, its biggest annual gain since 2010. The April contact is currently up $7.70 (+0.26%) an ounce to $2999.00 and the DG spot price is $2992.20.
The U.S. consumer price index for February, which came out Wednesday, showed that prices of goods and services increased less than expected in February, as did wholesale price in data released Thursday. But investors are increasingly concerned that the tariffs might cause inflation to rise further in the future and that may affect the Fed’s next moves on monetary policy.
The Fed has said it closely watches both inflation and the labor market when determining monetary policy. Interest rate cuts are bullish for gold, making the yellow metal a more attractive investment than some other assets.
The central bank cut rates three times in 2024, but most investors aren’t pricing in a Fed rate reduction until June, according to investors tracked by the CME FedWatch Tool. About 97% expect rates to remain unchanged next week, compared with 3% anticipating a 25 basis point cut.
The Fed kept its benchmark interest rate at 4.25% to 4.50% in January. It was the central bank’s first policy meeting since July 2024 without a rate cut. The Fed began raising interest rates in March 2022 to fight inflation, ultimately imposing increases of by 5.25 percentage points before beginning rate cuts last year. Previously, the Fed had kept rates at 5.25% to 5.50% for a year.
Front-month silver futures added 1.7% Thursday to settle at $34.31 an ounce on Comex, and the May contract increased 4.6% in the first four days of the week. Silver retreated 2.4% in February after adding 10% in January and dropping 6% in December. It gained 21% in 2024. The May contract is currently up $0.169 (+0.49%) an ounce to $34.475 and the DG spot price is $33.91.
Spot palladium gained 0.6% Thursday to $965.50 an ounce and is up 0.8% so far this week. Palladium retreated 10% in February after advancing 11% in January and falling 6.7% in December. Palladium dropped 17% last year. Currently, the DG spot price is up $24.50 an ounce to $985.50.
Spot platinum rose 0.3% Thursday to $996.10 an ounce and increased 2.9% in the first four days of the week. Platinum slid 4.7% last month after gaining 8.4% in January and losing 4.6% in December. Platinum slid 8.4% in 2024. The DG spot price is currently up $13.10 an ounce to $1004.10.
Disclaimer: This editorial has been prepared by Dillon Gage Metals for information and thought-provoking purposes only and does not purport to predict or forecast actual results. This editorial opinion is not to be construed as investment advice or a recommendation regarding any particular security, commodity, or course of action. Opinions expressed herein cannot be attributable to Dillon Gage. Reasonable people may disagree about the events discussed or opinions expressed herein. In the event any of the assumptions used herein do not come to fruition, results are likely to vary substantially. It is not a solicitation or advice to make any exchange in commodities, securities, or other financial instruments. No part of this editorial may be reproduced in any manner, in whole or in part, without the prior written permission of Dillon Gage Metals. Dillon Gage Metals shall not have any liability for any damages of any kind whatsoever relating to this editorial. You should consult your advisers with respect to these areas. By posting this editorial, you acknowledge, understand, and accept this disclaimer.