Silver on track for second weekly profit in row
Silver prices rose in European trade on track for the fourth straight session, hitting a two-week high and on track for the second weekly profit in a row as the dollar lost ground.
The decline comes following weak US GDP growth data, paving the way for an early interest rate cut by the Federal Reserve at the March meeting,
Silver Prices Today
Silver prices rose 0.4% to $24.50 an ounce, the highest since December 5, after rising 1.1% on Thursday, the third profit in a row as most dollar-denominated metals futures gained ground.
Weekly Trading
Silver is up 2.5% so far this week, on track for the second weekly profit in a row.
The Dollar
The dollar index fell 0.1% on Friday, sharpening losses for the second session, and plumbing a five-month trough at 101.73 against a basket of major rivals.
The decline came after government data showed the final reading for US GDP growth at 4.9% y/y in the third quarter, down from 5.2% in the previous reading, but still much higher than 2.1% in the second quarter.
Such data showcases the strength of the economy as it proves its resilience despite high interest rates.
Following the data, pricing for a US interest rate cut at the Fed March meeting surged to 83.5, and pricing for such a cut at the May meeting rose to 99.5%.
Now investors await crucial US personal spending data for November, which the Federal Reserve relied upon heavily to gauge the state of inflation in the country.
Gold hits two-week high ahead of US spending data
Gold rose in European trade on Friday on track for the second profit in a row, hitting two-week highs and on track for the second weekly profit in a row amid strong prospects of US interest rate cuts in March 2024.
Now investor await important US personal spending data later today, the favorite inflation gauge by the Federal Reserve.
Gold Prices Today
Gold prices rose 0.4% to $2,055 an ounce, the highest since December 4, with a session-low at $2,046, after rising 0.75%5 yesterday, the third profit in four days as the dollar lost ground.
The decline comes after US growth data, which disappointed the markets and paved the way for early Fed interest rate cuts in 2024.
Weekly Trades
Gold prices are up 1.75% so far this week on track for the second weekly profit in a row.
US GDP Growth
Government data showed the final reading for US GDP growth at 4.9% y/y in the third quarter, down from 5.2% in the previous reading, but still much higher than 2.1% in the second quarter.
Such data showcases the strength of the economy as it proves its resilience despite high interest rates.
US Rates
Following the data, pricing for a US interest rate cut at the Fed March meeting surged to 83.5, and pricing for such a cut at the May meeting rose to 99.5%.
US Personal Spending
Now investors await crucial US personal spending data for November, which the Federal Reserve relied upon heavily to gauge the state of inflation in the country.
The SPDR
Gold holdings at the SPDR Gold Trust remained flat yesterday at 878.25 tonnes.
What's triggering the new gas and oil production surge in the US?
It was mentioned in social media last week that the US is about to hit a new record high in crude production, with some voices opposing that narrative and pointing to the decline in rig oils.
Yes, the rig oil count for both gas and oil has declined recently, in fact by 20% in the last 12 months according to Baker Hughes, but it's a decline that came after a surge that sent the count to 800 by the end of 2022, before tapering off to 620 rigs now.
Despite the tapering off, the US gas and oil production is on track to hit fresh record highs as monthly production continues to rally, so how did that happen?
Many of the rigs are been dug but they're not completed or installed, and such abandoned rigs are called DUCs, and such rigs fell from 5300 to 4500 recently, however the actual active rig count remained strong.
In addition, improving technology now allows for much better productivity per rig compared to before.
For example, in 2007, there were 1500 natural gas oil rigs in the US, and the count fell to 1000 in 2009, then to about 120 nowadays, however, during that period, US natural gas production surged by 80%.
It's a similar story with oil production, as crude oil rigs amounted to 1600 in 2014, compared to 620 rigs nowadays, but oil production is 50% higher now.
Thus it's not quiet accurate, using the rig count to gauge current production trends in the US.
Wall Street climbs after GDP data
US stock indices rose on Thursday following mixed data, with GDP growth rate below expectations.
Government data showed the final reading for US GDP growth at 4.9% y/y in the third quarter, down from 5.2% in the previous reading, but still much higher than 2.1% in the second quarter.
Such data showcases the strength of the economy as it proves its resilience despite high interest rates.
Other data also showed unemployment claims up slightly to 205 thousand last week from 203 thousand in the previous reading.
On trading, Dow Jones rose 0.3%, or 109 points as of 17:07 GMT to 37,190, while S&P 500 rose 0.4%, or 19 points to 4,717, as NASDAQ added 0.6%, or 87 points to 14,865.