Gold, silver rally on tame U.S. inflation data

(Kitco News, Thurs. Oct. 10th, 2024) – Gold and silver prices are solidly higher in midday U.S. trading Thursday, following a U.S. inflation report that was deemed non-problematic despite being just a bit warmer than expected, and following an unexpected rise in weekly U.S. jobless claims. December gold was last up $18.20 at $2,644.10 and December silver was up $0.65 at $31.32.

Today’s U.S. consumer price index for September rose 0.2%, month-on-month, compared to expectations of 0.1%, and was up 2.4% year-on-year. The August CPI report showed the index up 2.5 percent, year-on-year. The core CPI rate (minus food and energy) was up 0.3%, month-on-month, versus expectations for up 0.2%. Year-on-year, the September core CPI was up 3.3% versus up 3.2% in August. The slightly warmer CPI report today was mitigated by higher-than-expected weekly U.S. jobless claims, which came in at 258,000 versus trade expectations for up 230.000. All in all, today’s U.S. data is being deemed friendly for the metals markets and unlikely to change the trajectory of an easier Federal Reserve monetary policy into the end of the year.

Friday’s producer price index report for September is seen coming in up 0.1 percent, month-on-month, compared to up 0.2% in the August report.

The key outside markets today see the U.S. dollar index near steady. Nymex crude oil prices are higher and are trading around $75.50 a barrel. The benchmark 10-year U.S. Treasury note yield is presently fetching 4.082%.

Technically, December gold bulls have the solid overall near-term technical advantage. Bulls’ next upside price objective is to produce a close above solid resistance at the contract high of $2,708.70. Bears’ next near-term downside price objective is pushing futures prices below solid technical support at $2,572.50. First resistance is seen at $2,650.00 and then at Tuesday’s high of $2,672.40. First support is seen at today’s low of $2,618.80 and then at $2,600.00.

December silver futures bulls have the overall near-term technical advantage. Prices are still in a two-month-old uptrend on the daily bar chart but bulls need to show fresh power soon to keep it alive. Silver bulls’ next upside price objective is closing prices above solid technical resistance at the May high of $33.50. The next downside price objective for the bears is closing prices below solid support at $29.00. First resistance is seen at $31.50 and then at $32.00. Next support is seen at $31.00 and then at this week’s low of $30.345.

Posted by:

Jack Dempsey, President

401 Gold Consultants LLC

jdemp2003@gmail.com