The Fed Golden Moment. Manic Metals Report 09/11/2024

The Fed’s first rate cut since March 15, 2020, in response to the economic impact of the COVID-19 pandemic could be a golden moment for the Fed as it should drive gold to another record high.  After a risk-off shakeout in the gold traders are buying back in. They are flocking into gold because of fears of a a slowdown in the global economy and hopes for Fed rate cuts driving the dollar lower, The CPI if hot could encourage inflation risk buying but also raise conerns about how aggressive the Fead can be as the embark on this new rate cutting cycle. Regardless, with Gold making new highs for the week it will not take much to break a new record today. Th stabilization in the stock market bides well for gold.

Kitco Gold pointed out that “the recent gold rally follows a $20 decline last Friday, triggered by the U.S. Labor Department’s underwhelming jobs report. August saw the addition of only 142,000 new jobs, falling short of the 160,000 predicted by economists. Moreover, downward revisions to both June and July figures suggest a prolonged weakening of the labor force, potentially influencing future monetary policy decisions.

Silver it’s also getting a big bounce as well as the risk on environment looks a lot better, the crash in oil prices it’s a double-edged sword for silver because it could be signaling a major slowdown in the economy, or it could be signaling then soft landing, regardless both silver and gold book to be a pretty good hedge for both situations.

Copper is also surging back this morning. Copper that has been living and dying with concerns about growth and the Chinese economy seems to be shaking that off ahead of the Federal Reserve decision today. To keep the drive alive December copper, need to pop 41700 for breakout and a continuation of the comeback.

Regardless about the pessimism about the economy we think that the precious metals and the industrial metals are undervalued at these price levels if the Fed cuts rates and if inflation is reasonable we expect a big recovery in copper platinum Palladium gold and silver it’s also probably a good time to add some physical silver to your portfolio .

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