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A Soft PPI Could Life Gold & Silver


Gold and silver prices are not responding in kind to another downside extension in the US dollar this morning, but gold and silver remain positively position on their charts. The precious metal markets have been held down by this week’s initial jump in US treasury yields even though treasury yields have declined from Monday’s peak. Today’s PPI report (which is predicted to gain by 0.4%) is an important force for the precious metals trade.


In our opinion, the rally in copper prices yesterday was extremely surprising and perhaps only partially justified especially considering the global infection surge and fears of further city lockdowns in China. However, the market appears to be capable of discounting demand fears and embracing supply-side threats from a strike in North America.


With the PGM markets failing to respond and produce volatility in the wake of this week’s inflationary news, it is clear they are on the outside looking in with respect to many commodities and financial instruments. The bear camp will suggest PGM prices should not be participating in the strength seen in other physical commodities as the Chinese economy continues to experience headwinds from city lockdowns.

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