METALS MARKET UPDATE – WHAT YOU NEED TO KNOW

• Gold prices were overall lower for the week after choppy trading.

• The dollar rose against many major currencies.

• U.S. business investment contracted more sharply than expected and corporate profit growth was "tepid".

• Gold ended the week at $1,496.90/oz. Silver closed at $17.60/oz.

https://uk.reuters.com/article/global-precious/precious-gold-set-for-weekly-loss-as-dollar-firms-on-safe-haven-inflows-idUKL3N26I0BB?rpc=401&

METALS NEWS –

A number of analysts see gold rising to $1600 before challenging the prior record high of nearly $2,000 an ounce.  

•  Gold prices could challenge all time highs according to Kitco's Jim Wykoff. "The acceleration of the longer-term price uptrend suggests a challenge of the all-time high of $1,908.60, scored in 2011, or above." https://www.kitco.com/news/2019-09-24/Gold-prices-poised-to-challenge-all-time-high.html

• Analysts are forecasting $1600 as the next target for the yellow metals bull run. "Gold's next upside target is $1,600 an ounce, according to analysts who are confident that the gold rally is not over due to unresolved U.S.-China trade talks, weak global growth and dovish Federal Reserve expectations." https://www.kitco.com/news/2019-09-24/Gold-price-to-hit-1-600-on-geopolitical-turmoil.html

• Joni Teves, precious metals strategist at banking giant UBS, upgraded her forecast for gold to $1600 by the end of the year. "In a report Tuesday, Joni Teves, precious metals strategist at UBS, said that she is upgrading her gold forecast as she sees prices pushing through $1,600 an ounce in the next 12 months. She added that she expects gold prices to push to $1,600 by the end of the year." https://www.kitco.com/news/2019-09-26/Gold-s-summer-rally-is-just-the-start-UBS.htm

• TD Securities believes that several fundamentals will send gold to $1600 including the Federal Reserve's intervention into the so-called "repo trades.". "The New York Fed announced that they would increase their daily repo transactions from the previously announced $75 billion to $100 billion through October 10th, and also offer two-week repo trades as well, which they increased from $30 billion to $60 billion, which should all help gold move into $1,600/oz territory." https://www.fxstreet.com/news/gold-could-reach-1-600-once-focus-turns-to-fundamentals-td-securities-201909261750

• Speaking at the Denver Gold Forum, Frank Holmes, CEO and chief investment officer at US Global Investors, said that gold could rise to $8,000 even absent a world crisis. "Holmes explained that worldwide money printing triggered by attempts to stimulate economic activity could lead to a substantial gold price increase. 'Gold can take off without (a) world-coming-to-an-end scenario … If gold was US$250 in 2001 and gold ran to US$1,900 — well, you've got an eight times increase. Gold then fell to US$1,000 and laid there for over five years. So if it went up another eight times that's US$8,000. Well, that doesn't mean the world's coming to an end.'" https://investingnews.com/daily/resource-investing/precious-metals-investing/gold-investing/frank-holmes-gold-reach-8000-without-crisis/

• Egon von Greyerz, Founder and Managing Partner of Matterhorn Asset Management, wrote that gold and silver are entering the "explosive" phase with gold prices rising above $2,000 an ounce. "The next explosive phase in the precious metals market has just started…. The masses will be alerted when gold reaches $2,000, which won't take very long. That's when lazy journalists and MSM (Main Stream Media) will start writing about gold and at that point it will even reach the front pages. These reporters, who can be from any country, do not realize that gold in 2019 has reached new highs in most currencies except in US dollars and Swiss Francs. But it is only a matter of time before gold will also hit new highs in these two currencies." https://kingworldnews.com/greyerz-buckle-up-we-have-just-entered-the-explosive-phase-in-gold-silver/

• Precious metals saw their second greatest inflow this week. "Precious metals enjoyed their second biggest inflows ever in the week to Wednesday, Bank of America Merrill Lynch said on Friday, as festering trade tensions and global growth woes triggered a rush for safe haven assets." https://uk.reuters.com/article/markets-funds-baml/precious-metals-net-second-biggest-weekly-inflows-on-record-baml-idUKL9N26F02X?rpc=401&

• The gold-silver ratio is signaling high precious metals price with silver enjoying the biggest boost according to technical analyst Christopher Aaron. "Three multi-year trend breaks have been observed in the gold to silver ratio since the start of the millennium. On average, the subsequent surge in silver has lasted for 4.6 months and resulted in a 77.6% gain in price… Investors should prepare for a price spike in silver that should target the mid-$20's at minimum within the next 4-6 months." https://www.silver-phoenix500.com/article/silver-price-forecast-rare-signal-says-surge-ahead

ECONOMIC NEWS –

Even before the Democrats announcement of impeachment proceedings against President Trump, analysts and "ultra-rich" investors were warning of a pending recession and fall in the stock market. And the new impeachment proceedings may further imperil the economy.

• Gluskin Sheff's chief economist and strategist issued a dire warning that the economy will likely skip into recession within the next 12 months even if the Federal Reserve cuts interest rates to zero. "[A] according to Rosenberg, it's just a matter of time until economic data sours and Powell is forced to resume easing in the coming months. 'I think that they'll go in October and December and through 2020,' he added. Whether the Fed cuts all the way to zero or not, Rosenberg speculates the outcome will be the same: Recession." https://www.cnbc.com/2019/09/22/recession-will-hit-the-us-within-12-months-david-rosenberg-warns.html

• A survey of the ultra-rich revealed a majority are expecting a recession by 2010. "More than half of the super-rich around the world are already preparing for a recession. That is according to a UBS survey of 360 global family offices with an average family wealth of $1.2 billion." https://www.cnbc.com/2019/09/24/a-majority-of-ultra-wealthy-expect-a-recession-and-are-hunkering-down.html

• Yahoo! Finance reported that investors may face a replay of the 2018 "market massacre" with a plummet in the stock markets. "'We could easily correct 15% to 20% from here. The market sentiment is that low rates are good for equities and at a certain point we are going to start to say that low rates mean low growth. I really think the market is sick at this point and we have mis-diagnosed the patient' … In other words, sleep with one eye open investors. The rawhide belt is never too far away." https://finance.yahoo.com/news/the-stock-market-could-crash-within-3-months-180959350.html

• President Trump has warned the stock market would "melt down" if Democrats succeed in impeaching him. "If they actually did this the markets would crash. Do you think it was luck that got us to the best Stock Market and Economy in our history. It wasn't." https://www.cnbc.com/2019/09/26/trump-warns-again-that-the-stock-market-would-crash-if-he-is-impeached.html

• Signs of a slowing economy continue with worrisome August numbers from the Commerce Department. "The U.S. economy cooled in August as Americans spent less than projected and companies cut capital-equipment orders, with below-forecast prices also adding to concerns that may support the case for further Federal Reserve easing. Treasury yields pared gains." https://www.bloomberg.com/news/articles/2019-09-27/u-s-economy-cools-as-consumer-spending-rises-less-than-forecast

• Social security recipients may not see any increase in their benefits even with a cost of living adjustment. "Social Security's cost-of-living adjustment, or COLA, likely won't rise much next year, but retirees may not feel any change — especially a positive one — at all… Social Security benefits have already lost one-third of buying power since 2000…." https://www.marketwatch.com/story/the-2020-social-security-cola-is-expected-to-be-low-and-thats-not-even-the-worst-part-2019-09-26?mod=mw_theo_homepage