Craig Hemke – Fed Rate Cut Expectations Have Become The Prime Mover In Gold, Yet Silver Still Follows The Dollar
Craig Hemke, Founder and Editor of TF Metals Report, joins us to outline how Fed rate cut expectations continue to be the key input factor for gold pricing, while silver and the other metals continue to follow the moves in the dollar. With gold mostly holding above $2,000 since mid-November to present, it is an encouraging level to be basing at, but it won’t start to really break out of the tight range it’s been in until we see more conviction in the Fed actually cutting rates. We talk about the coming GDP data and upcoming Fed meeting later this week, but he doesn’t expect much to come of any of it.
Silver is had been trading near it’s long-term support at $22, without much direction either way, but has been popping higher lately, along with most commodities, as the dollar weakened. With regards to COT readings, Craig makes some interesting observations on the open interest from hedge funds and speculators versus the banks, that have some potentially constructive outcomes in the near-term to medium-term for silver. We also point out that the GDX is far more closely correlated to the silver price than the gold price, and so a breakout in the lessor precious metal, would also be good for the gold and silver mining stocks.