(Kitco News) - Gold and silver prices are mildly weaker in early U.S. trading Tuesday. The precious metals markets are pausing ahead of the U.S. jobs report on Wednesday and some U.S. inflation data late this week. Selling interest is limited due to safe-haven demand amid a geopolitical scene that remains active but not hot. April gold was last down $10.00 at $5,069.00. March silver prices were down $0.514 at $81.75.
Trump says Warsh as Fed chair can produce 15% U.S. GDP. President Trump says his pick to lead the Federal Reserve can boost the U.S. economy to grow at a rate of 15%, “an exceedingly rosy target that nonetheless underscores the pressure that Kevin Warsh will face if confirmed to the role,” Bloomberg said in a report. Trump, speaking in an interview with Fox Business, said Warsh was the “runner up” in his last search and that it was a big mistake to pick Fed chair Jerome Powell. If Warsh “does the job that he’s capable” of, then “we can grow at 15%, I think more than that,” Trump told host Larry Kudlow in a clip aired Monday. “I think he is going to be great, and he’s a really high-quality person.” It was not fully clear if Trump was referring to year-over-year growth or some other metric. The U.S. economy, which is seen expanding 2.4% this year, has grown at an average annual rate of 2.8% over the past five decades, said Bloomberg.
Yuan rallies after China urges its financial firms to limit buying U.S. Treasuries. China’s offshore yuan advanced to 6.9 per U.S. dollar Tuesday, nearing its highest level in 34 months, as momentum built after Chinese regulators urged banks to curb excessive exposure to U.S. Treasuries. Financial institutions were advised to rein in Treasury holdings and trim positions where exposure is high, citing concerns over concentration risks and to mitigate the impact of uncertain U.S. economic policies. “The shift underscores a broader global move away from dollar assets and fueled expectations of a gradual structural shift in China’s currency strategy, especially after President Xi Jinping outlined ambitions for a ‘powerful currency’ in state media earlier this month,” said TradingEconomics.com.
Russia just “buying time” in peace talks: spy report. Russia is exploiting negotiations to end the war in Ukraine as a “tool for manipulation” with no intention of ending the invasion, according to an assessment by Estonian foreign intelligence and as reported by Bloomberg.
“The Kremlin's main objective is to restore full relations with the U.S., which would open the possibility of direct flights and visas for the business elite, as well as easing the path for espionage and influence operations. Russia is highly likely preparing for future conflict even as its war against Ukraine continues, and its military-industrial complex will continue to be a danger to its neighbors even after a peace deal might be agreed,” said the Bloomberg report.
The key outside markets today see the U.S. dollar slightly up, with crude oil prices slightly up and trading around $64.50 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 4.1 percent.
Note: The gold market operates through two primary pricing mechanisms. The first is the spot market, which quotes prices for on-the-spot purchase and immediate delivery. The second is the futures market, which sets prices for delivery at a future date. Due to year-end positioning market liquidity, the December gold futures contract is currently the most actively traded on the CME.
Technically, April gold futures bulls’ next upside price objective is to produce a close above solid resistance at $5,250.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at the February low of $4,423.20. First resistance is seen at last week’s high of $5,113.90 and then at $5,200.00. First support is seen at this week’s low of $4,988.60 and then at $4,900.00. Wyckoff's Market Rating: 6.5.
March silver futures bulls see the next upside price objective is closing prices above solid technical resistance at last week’s high of $92.015. The next downside price objective for the bears is closing prices below solid support at $60.00. First resistance is seen at the overnight high of $83.745 and then at $85.00. Next support is seen at this week’s low of $83.76 and then at $82.00. Wyckoff's Market Rating: 5.0.
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