(Kitco News) - Gold prices are slightly up and silver prices solidly higher in early U.S. trading Friday, just ahead of a key U.S. inflation report. Some safe-haven demand is featured heading into the weekend, what with U.S.-Iran tensions remaining elevated. April gold was last up $8.40 at $5,202.30. March silver prices were up $2.697 at $89.735.
U.S. producer price index on deck. Traders and investors get a key U.S. inflation gauge to end the trading week and the trading month: the producer price index for January. This morning’s PPI report is seen coming in at up 0.3%, month-on-month, compared to the 0.5% rise seen in the December report. PPI excluding food and energy is also seen up 0.3% in January from December, and compares to a rise of 0.7%, month-on-month, in the December report.
U.S., Iran nuclear talks to continue next week, after some progress made… The U.S. and Iran will continue nuclear talks next week after making “significant progress” in Switzerland, mediator Oman said and as reported by Bloomberg. Negotiations will resume at a technical level in Vienna, Austria after an initial consultation period, according to Oman’s Foreign Minister Badr Albusaidi. “The U.S. team has tough demands for the Iranians, including that they destroy three main nuclear sites and that any nuclear deal must last forever and not have so-called sunset clauses,” said the report. Iran said it won’t allow any of its highly enriched uranium to be moved out the country, Press TV said, citing Esmail Baghaei, a spokesman for Iran’s Ministry of Foreign Affairs. U.S. officials are yet to comment publicly, though have previously signaled Iran would have to send such stocks of uranium to another nation or dilute them.
Jack Dorsey’s tech firm Block cutting half its staff, turning to AI. Jack Dorsey’s Block is laying off 4,000 employees, reducing its workforce by nearly half, as the financial technology firm places a bet on artificial intelligence changing the future of labor productivity. “Block has been restructuring its business model and staffing since 2024 as the company’s stock has lagged. At the same time, the company has invested heavily in artificial intelligence tools to run more efficiently, including building its own tool called Goose. The reduction in force, which was announced in a shareholder letter on Thursday, comes after rolling job eliminations that have often been tied to annual performance reviews,” Bloomberg reported. “We are taking bold and decisive action here, but we’re doing it from a position of strength,” Amrita Ahuja, chief financial officer, said in an interview with Bloomberg. “We’re doing it in a way that we believe positions us to move even faster for our customers.” The move by Block is the latest indication of the havoc that new AI tools are wreaking on the economy and financial markets, said the report.
Average 30-year mortgage rate falls below 6% for first time since 2022. The average 30-year mortgage rate in the U.S. has slipped below 6% for the first time since 2022, to 5.98%, which could breathe life into the coming spring home-selling season. “A rate below 6% may ease affordability slightly and get some buyers off the fence, but borrowing costs would have to plunge significantly further to fully unlock the housing market,” said Bloomberg. The mortgage payment needed to purchase an average home in the U.S. has fallen to about 27% of the median household income, and affordability pressures have been slowly easing due to lower interest rates, softer home prices, and rising incomes.
The key outside markets today see the U.S. dollar index a bit weaker, with crude oil prices higher and trading around $66.75 a barrel. The yield on the benchmark 10-year U.S. Treasury note is presently 3.99 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.
April gold futures bulls’ next upside price objective is to produce a close above solid resistance at $5,400.00. Bears' next near-term downside price objective is pushing futures prices below solid technical support at $4,854.20. First resistance is seen at this week’s high of $5,269.40 and then at $5,300.00. First support is seen at this week’s low of $5,109.50 and then at $5,100.00. Wyckoff's Market Rating: 7.0.
March silver futures bulls see their next upside price objective is closing prices above solid technical resistance at $100.00. The next downside price objective for the bears is closing prices below solid support at the February low of $71.815. First resistance is seen at this week’s high of $91.34 and then at $93.00. Next support is seen at $87.00 and then at this week’s low of $84.56. Wyckoff's Market Rating: 6.5.
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