Member of the LBMA
Independent Authority for precious metals
Inflation in the United States has risen by 1.2% in the last month to 3.1% overall; the highest recorded levels measured by the core personal consumption expenditures (PCE) index since the early 1990s.
Using the PCE index, Bureau of Economic Analysis reported inflation at 1.9% at the end of March, and today has reported a marginally stronger increase than the predicted 2.9% inflation.
European markets are on the up today ahead of US President Joe Biden's budget announcement due today. The Stoxx 600 index, covering Europe, is up 0.45% today to an all-time high of 448.48 points.
The budget is rumoured to be a $6 trillion spending package for 2022, with Covid recovery schemes included in the proposals and the potential to spend even more over the next decade.
Continuing its recent bull run, gold has made further gains in trading so far this week, and has climbed to a 4.5 month high overnight. Gold has risen above $1,900 per ounce for the first time since early January, hitting a peak of $1,910.63 this morning.
Following a strong week for gold and silver, both metals have seen further gains in trading today, pushing them up to a four and three-month high respectively.
The gains come as inflation fears continue to circulate among global markets, as well as a sharp correction in the price of Bitcoin.
High inflation figures from the US yesterday have triggered further volatility for precious metals.
Despite the highest inflation figures since 2008, and a stock market sell off, gold and silver have also come under pressure from a rising Dollar and bond yields.
After a volatile start to the week, gold has made strong gains the past two days, breaking through the $1,800/£1,300 per ounce barrier that has proven a resistance point for prices in recent weeks. Silver also enjoyed strong gains, up 4.56% in the past week.
The Bank of England has updated its forecast for the UK's economic performance in 2021, with GDP growth forecast to rise to 7.25% - up from the previous 5% forecast. Unemployment is also expected to peak at just below 5.5% at the end of Q3 this year; still higher than the approximate 4% of early 2020, but a lot lower than the speculated 12%.
Precious metal prices are volatile this week, as gold and silver saw price pressure yesterday after nearing two-month highs. The price pressure came as Treasury Secretary Janet Yellen suggested that interest rate increases may be needed to keep the US economy from overheating following a year of fiscal stimulus and upcoming spending plans from President Biden.
