1. Gold rose to a new all-time high Monday amid a rush to safer assets after U.S. President Donald Trump imposed tariffs on Canada, Mexico, and China while threatening to do the same against the European Union. Safe-haven demand is featured in the yellow metal amid keener marketplace uncertainty. April gold was last up $16.30 at $2,851.30. March silver was up $0.04 at $32.305. Technically, April gold futures bulls have a strong overall near-term technical advantage. Prices are trending up on the daily bar chart. Bulls’ next upside price objective is to produce a close above solid resistance at $2,900.00. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at this week’s low of $2,760.20. March silver futures bulls have the overall near-term technical advantage amid a price uptrend in place on the daily bar chart. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the December high of $33.33. The next downside price objective for the Bears is closing prices below solid support at $30.00.
2. Stocks got hammered, the dollar climbed, and short-dated Treasury yields outperformed on concern that sweeping tariffs could hamper global economic growth and fuel inflation. Equities dropped across the board, with the S&P 500 down 1.5%. Carmakers with big exposure to Mexico, Canada and China tumbled. Semiconductor companies, which are likely to find themselves in the geopolitical crosshairs also got hit. While the dollar pared a rally that earlier put it on pace for its biggest advance since the onset of the pandemic, the greenback was still up against almost every major currency. The Mexican peso lost 1.3% while Canada’s Loonie dropped 0.9%. Treasury two-year yields rose as much as eight basis points to 4.28% as longer-dated rates fell, flattening the curve. Such moves are typically associated with stagflation — when inflation and elevated interest rates harm bonds in the short term, only for subsequently weaker growth to make longer-term debt more appealing.
3. Activity in the U.S. manufacturing sector expanded in January after 26 months of contraction, a survey from the Institute for Supply Management indicated on Monday. The ISM purchasing managers index for manufacturing rose to 50.9 percent from 49.2 percent in December, crossing the 50 percent threshold dividing contraction from expansion. The improvement beat expectations. Economists had forecasted a smaller gain to 49.5, which would have meant factory activity was still contracting. The survey indicates that new orders grew for the third straight month after seven months in contraction. The production index crossed into expansion territory after eight months in contraction. The employment index jumped into expansion territory as well. The index has surged since the election of Donald Trump, as manufacturers anticipate more business-friendly policies. Trump has said he will cut taxes, reduce regulation, and raise tariffs to protect U.S. manufacturers from unfair trade practices. The gauge of prices increased, indicating rising prices, but remains at a moderate level.
4. U.S. job openings dropped sharply in December, but low layoffs suggested that the labor market was not abruptly slowing down. Job openings, a measure of labor demand, decreased 556,000 to 7.6 million on the last day of December, the Labor Department’s Bureau of Labor Statistics said in its Job Openings and Labor Turnover Survey, or JOLTS report, on Tuesday. Data for November was revised slightly higher to show 8.156 million vacancies instead of the previously reported 8.098 million. Economists polled had forecasted 8.0 million unfilled positions. Layoffs fell 29,000 to 1.771 million. It is, however, becoming harder for laid-off workers to find new jobs as employers remain cautious about adding headcount. Hires increased from 89,000 to 5.462 million.
5. American workers are taking longer to find jobs. Data from the Labor Department out Thursday showed 1.89 million continuing weekly unemployment insurance claims were made during the week ending Jan. 25, up from 1.86 million the week prior and near their highest level of the past three years. This shows more Americans are remaining unemployed for longer and continuing to claim unemployment benefits. While the number of new Americans filing for weekly claims remains near its lowest level of the past year, reflecting a low layoff environment, economists have argued the elevated level of continuing claims shows it’s becoming increasingly challenging for workers to find a new job. The Federal Reserve has recently acknowledged the growing challenges for workers in the labor market too. “It’s a low hiring environment,” Fed Chair Jerome Powell said in a press conference on Jan. 29. “So, if you have a job, it’s all good. But if you have to find a job, the job finding rate, the hiring rates have come down.”
6. The number of Americans filing new applications for unemployment benefits increased moderately last week, consistent with gradually easing labor market conditions. Initial claims for state unemployment benefits rose 11,000 to a seasonally adjusted 219,000 for the week ended February 1, the Labor Department said on Thursday. Economists polled had forecast 213,000 claims for the latest week. Low layoffs are underpinning the labor market, though work opportunities are becoming scarcer for those who are unemployed. The government reported on Tuesday that there were 1.1 job openings for every unemployed person in December, down from 1.15 in November.
7. Oil prices rose on Friday after new sanctions were imposed on Iran’s crude exports but were on track for a third straight week of decline. Brent crude futures were up 42 cents, or 0.6%, at $74.71 a barrel at 1300 GMT, but were poised to fall 2.6% this week. U.S. West Texas Intermediate crude was up 39 cents, or also 0.6%, to $71 a barrel, down 2% on a weekly basis.
8. Euro rose in European trade on Wednesday against a basket of major rivals, advancing for the second straight session against the dollar. It comes as concerns about a US-EU trade war calmed down with the odds of reaching a settlement growing. The euro was also boosted as the odds of an ECB interest rate cut in March receded amid renewed inflationary pressures on ECB policymakers. The EUR/USD pair rose 0.15% today to $1.0394, with a session low at $1.0369.
9. The Japanese Yen (JPY) weakens across the board in reaction to cautious remarks from the International Monetary Fund (IMF), which, in turn, prompts some short covering around the currency pair. The USD/JPY pair stages an intraday recovery from sub-151.00 levels or the lowest since December 10 touched earlier this Friday, and for now, seems to have snapped a four-day losing streak.
Gold demand is surging to new records, driven by accelerating purchases from central banks as well as investors seeking a safe haven amid the threat of escalating tariffs. On Wednesday gold hit record highs for the fifth consecutive day, surpassing $2,877 per ounce in trading, as futures also climbed to new highs above $2,900. “Central banks continued to hoover up gold at an eye-watering pace” in 2024, according to a report by the World Gold Council, as purchases accelerated sharply in the fourth quarter. Total demand last year reached a new high of 4,974 tons. Joe Cavatoni, market strategist at the World Gold Council, said central bank purchases were driven by “concerns about ongoing inflation, geopolitical tensions, and needs to add diversification to their portfolios.” Gold is up roughly 8% year to date after gaining over 29% in 2024, outpacing the S&P 500’s gain of 23.1%.
Treasury Secretary Scott Bessent said Donald Trump is not asking the Federal Reserve to lower its short-term interest rates, but what he and the president do want is to bring down longer-term borrowing costs via 10-year Treasury yields. While the Fed sets short-term borrowing rates that can have a domino effect and influence longer-term rates, other factors buffet 10-year government bond yields — including the outlook for economic growth, inflation, supply of Treasuries, and more. Despite the Fed’s rate-cut campaign in late 2024, longer-term interest rates in the U.S. increased sharply, which has meant higher rates on mortgages and other borrowings.
Mortgage rates fell slightly this week amid a period of market volatility. The average 30-year mortgage rate was 6.89% this week through Wednesday, down from 6.95% a week earlier. Fifteen-year mortgage rates fell to 6.05%, from 6.12%, according to Freddie Mac data. Mortgage application activity has been mixed as rates remain close to 7%. Refinancing applications rose 12% through Friday compared to a week earlier, according to the Mortgage Bankers Association, while applications to purchase a new home fell 4%.
U.S. stocks fell on Friday as investors reacted to the threat of more possible tariffs, while digesting a jump in consumer expectations for inflation and the quickly overshadowed monthly jobs report. The S&P 500 moved 1.0% lower, while the tech-heavy Nasdaq Composite slid around 1.47%. The Dow Jones Industrial Average also fell 1.1% on the heels of a mixed day for stocks on Wall Street. The major gauges slid earlier into the red after U.S. consumer sentiment sank to a seven-month low in early February, undershooting forecasts.
Volatility should be expected to remain high as investors will be closely watching for hints on the upcoming monetary policy direction. Many investors have redoubled their efforts to ensure that their portfolios are sufficiently diversified in the hope that they will be able to withstand corrections in multiple market sectors. Many of these investors have included physical precious metals as part of their diversification plans, given their long history as a hedge against both inflation and during times of economic turmoil. Remember, the key to profitability through the ownership of physical precious metals is to own the physical product and hold it for the long term. Always remember that you should never overextend your ability to maintain ownership of your precious metals over the long run.
Trading Department – Precious Metals International Ltd.
Friday to Friday Close (New York Closing Prices)
| Jan. 31, 2025 | Feb. 7, 2025 | Net Change | ||
| Gold | $2,808.44 | $2,864.38 | 55.94 | 1.99% |
| Silver | $31.49 | $32.05 | 0.56 | 1.78% |
| Platinum | $984.95 | $984.15 | -0.80 | -0.08% |
| Palladium | $1,025.76 | $973.10 | -52.66 | -5.13% |
| Dow | 44544.19 | 44303.65 | -240.54 | -0.54% |
Previous Year Comparisons
| Feb. 9, 2024 | Feb. 7, 2025 | Net Change | ||
| Gold | $2,024.68 | $2,864.38 | 839.70 | 41.47% |
| Silver | $22.53 | $32.05 | 9.52 | 42.25% |
| Platinum | $876.05 | $984.15 | 108.10 | 12.34% |
| Palladium | $871.00 | $973.10 | 102.10 | 11.72% |
| Dow | 38671.30 | 44303.65 | 5632.35 | 14.56% |
Here are your Short-Term Support and Resistance Levels for the upcoming week.
| Gold | Silver | |
| Support | 2782/2748/2695 | 30.91/30.08/28.85 |
| Resistance | 2870/2923/3014 | 32.13/32.97/34.19 |
| Platinum | Palladiumn | |
| Support | 945/913/891 | 958/909/868 |
| Resistance | 998/1020/1052 | 1048/1089/1139 |