Gold and silver prices have rebounded from last week’s drop, with gold in particular finding support at $2,400. Silver has seen some recovery since falling last week but has failed to hold onto $30.
Having set a new all-time high price of $2,484.04 this time last week, gold saw prices fall back as momentum dried up, and profit-taking kicked in. Gold dropped almost $100 at its worst, hitting $2,384.62 per ounce on Monday afternoon. As has been seen recently however, the price rebounded as people bought the dip, and gold found solid support at $2,400.
Gold is trading at $2,415 per ounce today, as markets continue to weigh up a lot of uncertainty over the weekend surrounding the US election, and further fears of conflict between Israel and Lebanon.
Silver has struggled to get the same level of support as gold however, with a sharper fall that it has not recovered from to the same degree as gold. Silver (as well as many other industrial metals) has struggled on lower growth figures from China last week. Fears of slowing production are impacting silver more than gold, which dropped from a peak of $31.78 last week to a low of $28.71 on Tuesday. The silver trading price is at $29.40 at the time of writing and will be looking to retake $30.
There has been further political uncertainty for the US election over the weekend following President Joe Biden’s confirmation he will stand down and isn’t seeking re-election in November. Vice-President Kamala Harris is currently expected to be the Democrat nominee, but polls suggest it may not be sufficient to beat Donald Trump. This uncertainty was reflected in a lack of significant movement in the gold/silver price when markets reopened after the weekend.
An interesting development in Asia this week came from India, with the announcement that import duties on gold and silver will be cut significantly from 15% to 6%. This will certainly help support precious metals in a key market, with significant cultural demand for gold and silver in India. This should help offset some of the weaker demand seen from China lately after the spring rally for both metals fuelled by Chinese demand.
With gold up 20% in the past six months, and setting multiple new records along the way, dips such as that seen on Friday are to be expected, but it is highly positive that it continues to hold onto the majority of the gains, with previous highs becoming solid support levels. With $2,400 looking like a new potential floor, it will make $2,500 much more achievable as the year progresses.
