Posts On Economic and Geopolitical News

6-Year Highs Just the Beginning

The gold market recently powered to a 6-year high as the notion of a dovish Fed and easy money policies gained further steam. The market saw a buying frenzy take prices straight to the $1450 region, a level which, if breached, could signal a much more significant upside rally. The market may simply be getting started in the early stages of the next great bull market which could take prices back to all-time highs near $2000 per-ounce and well beyond. There are numerous factors that... Continue Reading

Central Banks Keep Buying

Global central banks have continued to keep buying gold, adding even more of the metal to their portfolios in June. The month reportedly saw reserves climb by 8 percent, the largest monthly increase in three years, as trade and geopolitical tensions heated up. Countries such as Kazakhstan, Russia and Turkey all added more of the metal to their reserves, while China also previously reported another large increase in its holdings. The recent trend in additions could be set to continue, especially against the current backdrop... Continue Reading

All Eyes on the Fed

This week features the release of the latest FOMC meeting minutes as well as testimony before Congress by Fed Chief Jerome Powell. The minutes will be released on Wednesday, while Powell’s remarks will begin Wednesday and conclude Thursday. The latest meeting minutes will likely take a back seat to Powell’s comments, and investors are hoping that the Fed Chief will provide some clarity about the central bank’s plans regarding rates going forward. Expectations for an interest rate cut have been dialed back in recent days... Continue Reading

Are Stocks Making a Bull Trap?

The benchmark S&P 500 hit a fresh all-time record today. Stocks and risk appetite are on the rise as investors remain hopeful that a U.S./China trade agreement will be reached. Over the weekend, President Trump met with Chinese Leader Xi Jinping at the G20 meetings in Japan, and the two leaders essentially called a truce. The U.S. agreed not to raise levies on additional Chinese goods, while China reportedly agreed to purchase more U.S. agricultural products. With the two sides seemingly back at the bargaining... Continue Reading

Wait, What?

The highly anticipated Fed policy meeting has now come and gone, with Fed Chief Jerome Powell set to deliver his press conference. The central bank voted by a margin of 9-1 to hold the Fed Funds rate steady. The central bank did, however, still hint at the potential for rate cuts should conditions warrant such a move. The FOMC removed the word “patient” from its outlook, in a move that could signal a large degree of flexibility by the central bank. Some analysts have suggested... Continue Reading

U.S. Hardline Stance May Cause Dominos To Fall

The current state of geopolitics and the global economy warrant caution. Stocks are moving slightly higher in early action on Monday as the markets seem to be pinning their hopes on the Fed and another series of rate cuts. The Fed will be meeting this week, and although no action is expected on Wednesday, the central bank could lay the groundwork for the first rate cut in over 10 years next month. There are currently several issues at work, however, that could potentially set off... Continue Reading

Lower Rates Are on the Way

It’s no secret that the U.S. and global economies have hit some major bumps in the road in recent months. The ongoing U.S./China trade war is having a measurable impact on the economies of both nations, and thus far the war on trade appears set to continue for some time. The U.S. also last week announced a five percent tariff on Mexican goods to begin June 10th. Those tariffs are set to increase until Mexico takes action to stop the flow of illegal immigrants along... Continue Reading

Risk Aversion Accelerates – This Could Be It

The gold market is finally seeing some significant upside as risk aversion accelerates. The metal has now broken out of its recent trading range and could potentially set its sights on a new high for the year in the weeks ahead. There are numerous issues behind the recent ascent, and many of these issues could potentially fuel the next major global recession. The ongoing U.S./China trade war appears poised to continue. After a deal was reported to be close in recent weeks, both sides have... Continue Reading

War on Trade Could Force the Fed’s Hand

Not long ago, the Federal reserve had taken a decidedly hawkish approach towards monetary policy. The Fed seemed confident in the economy and was ready to continue the current cycle of interest rate hikes. Market dynamics have shifted significantly in recent months; however, and thus the Fed may be forced to reverse course and start cutting rates again. The market has already priced in a 25-basis point hike by the end of the year. With the latest Fed meeting minutes looming this afternoon, the question... Continue Reading

The Only True Safe Haven

Just because the gold market has had limited upside in recent months does not mean that investors won’t turn to the metal if things get dicey. The ongoing U.S./China trade war has taken a turn for the worse in recent weeks, and the war over trade could potentially take much longer to resolve than previously anticipated. Last week, Both sides pushed away from the negotiating table. The U.S. raised tariffs on $200 billion of Chinese goods from 10 percent to 25 percent. China, as expected,... Continue Reading