Markets Race Ahead—Gold Up 3.75%, Silver Soars 6.4%, Dollar Slides as Fed Cuts Gain Steam
Markets are sprinting ahead as traders digest Fed Chair Powell’s recent signals pointing toward interest rate cuts, driven by a softening labor market.
Since Powell’s remarks last Monday, gold has climbed around 3.75%, jumping from $3,355 to nearly $3,486 per ounce—a powerful rally of roughly 130 points. Meanwhile, silver has staged an even steeper climb, soaring about 6.4%, moving from $38 to $40.50, gaining over $2.50. This precious metals surge reflects investor bets that easier monetary policy is just around the corner.
The U.S. dollar, which initially tried to strengthen, quickly lost steam and dropped back to weekly lows near 97.70 after briefly touching highs of 98.75. The dollar’s retreat is playing right into the hands of gold and silver buyers—metals priced in greenbacks become cheaper when the USD weakens.
Overall, the markets are clearly factoring in a 25-basis-point Fed rate cut in September, with expectations now exceedingly high. This has ignited a wave of buying in safe-haven assets and renewed confidence in risk-on trades.
Impact:
As rate-cut expectations rise, the USD weakens, boosting gold and silver. If those cuts materialize, risk appetite should grow, putting further pressure on the dollar and supporting commodity-linked currencies.
