Gold and Silver Prices Surge as Global Rate Cuts and US GDP Boost Safe-Haven Demand

Gold trades at $2,665 and silver near $32.15, driven by central bank rate cuts and strong US GDP data, boosting safe-haven demand.

 Gold Breaks Key Resistance (photo credit: SHUTTERSTOCK)
Gold Breaks Key Resistance
(photo credit: SHUTTERSTOCK)

Gold and silver prices continue their upward momentum, driven by lower global interest rates and escalating geopolitical tensions. As of Thursday, gold (XAU/USD) is trading at $2,665, while silver (XAG/USD) is holding near $31.15. Both benefit from increased safe-haven demand. The weakening US Dollar and global economic concerns have further contributed to the positive market sentiment for these precious metals.

Central Bank Rate Cuts Boost Gold Demand

Global central banks, including the People's Bank of China (PBOC), Sweden's Riksbank, and the Czech National Bank, have implemented interest rate cuts in response to economic slowdowns. These actions reduce the opportunity cost of holding non-yielding assets like gold, making it a more attractive option for investors seeking stability. Gold prices have been particularly supported by expectations of a 50 basis point rate cut from the US Federal Reserve in November.

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Despite strong US New Home Sales and Mortgage Applications data, market participants remain focused on the upcoming Jobless Claims report and Fed Chair Jerome Powell’s speech, which could shape future monetary policy. The CME FedWatch tool shows a 60% probability of a 50 bps cut, keeping pressure on the US Dollar and providing a tailwind for gold.

Growth Prospects and Challenges in the Silver Nitrate Market

The global silver nitrate market is expected to grow at a CAGR of 5.2% from 2022 to 2032, increasing from $5.3 billion to $8.8 billion. This growth is driven by rising demand in sectors like construction and automotive, where silicone elastomers are essential. 

Silver nitrate's role in medical and industrial applications also supports this expansion. However, regulatory compliance, market volatility, and supply chain disruptions may impact profitability and growth, influencing silver prices and broader market sentiment. Investors should weigh these risks when considering the future of silver-based products.

Key Events Impacting Gold:

  • The Conference Board Consumer Confidence Index dropped to 98.7 in September, below expectations of 105.6.
  • Jerome Powell's speech has already taken place, and contrary to expectations, he did not provide any comments on monetary policy. As a result, there was no significant impact on metals, including gold prices.

Tomorrow's Events to Watch

  • Core PCE Price Index (0.2%): A key inflation measure that could influence Fed rate decisions.
  • Revised University of Michigan Consumer Sentiment: This will provide further insight into consumer confidence, potentially affecting market sentiment.
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This article is for informational purposes only. The opinions and analysis herein are those of the author and are not financial advice. The Jerusalem Post (JPost.com) does not endorse or recommend any investments based on this information. Investors should consider their financial situation, investment goals, and risk tolerance before making any decisions. Consulting a qualified financial advisor is recommended. JPost.com is not liable for any investment losses from using this information. The information provided is for educational purposes only and should not be considered as trading or investment advice.