Gold's Luster Dims, Take a Break!
Gold held steady at around $3,980/oz on Friday after falling below $4,000 the previous day due to profit-taking and a strengthening dollar. Technically, gold has been in overbought territory for most of this month, leading some market participants to lock in profits after a four-day rally that pushed it to a new record high of around $4,059/oz.
Silver also corrected after hitting $51,235/oz—its highest since 1980—but year-to-date is still up around 70%, far outperforming gold. The surge in interest in precious metals is linked to concerns about an overheated stock market, US fiscal pressure, and the issue of the Fed's independence. Yesterday's correction coincided with a decline in US stocks; when volatility increases, gold can be sold to cover losses in other assets. Nevertheless, gold remains on track for its eighth weekly gain.
At the start of the Asia/Singapore session, spot gold was flat at around $3,987/oz; The Bloomberg Dollar Index remained relatively stable after hitting a 10-week peak. Silver fell slightly, while platinum and palladium strengthened. In addition to its negative correlation to the dollar and US interest rates, silver is supported by the industrial sector (solar and wind energy), which now accounts for more than half of demand—with a supply deficit expected to persist into 2025.
The London silver market is tightening, pushing up borrowing costs. Concerns about potential US tariffs on silver are driving shipments to America, draining London inventories and reducing the metal's availability for borrowing—factors that increase price sensitivity to short-term inflows and outflows.
Key points:
Gold stabilizes near $4,000 after profit-taking; the weekly trend remains positive.
Silver retreats from its record high, but remains ahead year-to-date thanks to industrial and hedging themes.
A strong dollar and overbought conditions have triggered a pause in the precious metal's rally.
Silver supply deficit persists into 2025; the London market is very tight, borrowing costs are high. (asd)
Source: Newsmaker.id
