To say that 2024 has been an interesting year is quite the understatement. After all, who would have had “Trump assassination attempt” on their 2024 bingo card?
What promised to be a heated Presidential election will likely be even more so. And with over three months still to go before the elections, there’s no telling what will happen between now and then.
But it isn’t just political events that are impacting precious metals prices today, it’s financial events too. While the summer normally is a time when things get quiet due to so many people being on vacation, this summer has been an exciting one so far for gold and silver.
Here’s how recent events have impacted gold and silver prices.
Attack on Trump Boosts Gold Price
As safe haven assets, gold and silver are assets that people tend to demand during times of heightened uncertainty. And what could drive uncertainty higher than an assassination attempt on a former President who is running to retake his office?
While the election is still too far out to predict, many polls had Trump moving ahead recently, due to President Biden’s numerous and much publicized foibles. But all it takes is one bullet and all of that goes up in the air.
It’s only natural that many people would react by buying gold, sending gold prices higher to new all-time highs. Despite some profit-taking in the interim, gold still looks like a pretty strong candidate to hit $2,500 in the near future, and $2,600 wouldn’t even be out of the question either.
Silver jumped quite a bit too, although profit-taking there has been a little bigger than with gold. Still, given the heightened uncertainty surrounding the election, that could keep silver and gold prices staying elevated for at least the next few months.
Fed Comments Getting More Dovish
While political uncertainty has been a major driver in gold and silver prices, recent comments from a number of Federal Reserve officials have been interpreted as meaning the Fed is leaning towards easing monetary policy in the near future.
First there was Fed Chairman Jay Powell, who stated that the Fed’s next move would more likely be to start easing policy, which he thinks the Fed could do at the right moment. Then came Fed Governor Christopher Waller, who stated that he believes the “time to lower the policy rate is drawing closer.”
Finally, New York Fed President John Williams also threw his hat into the ring, adding to the chorus of voices expressing the view that monetary easing could be coming sooner rather than later.
While Williams and others think that it’s still not time to cut rates, a few more months of “good” data on inflation would likely nudge them to consider rate cuts. That means that a rate cut is all but out of the question at this month’s Federal Open Market Committee.
But with the next meeting after that taking place in September, after two more months of Consumer Price Index (CPI) data, there could be more momentum for a September rate cut.
If headline CPI drops below 3% for the next two months, and if core CPI remains low, there could be a rate cut in September. Markets are already starting to try to price in one or two rate cuts that could cut the federal funds rate below 5% by the end of the year.
Again, as with the election, there’s a lot of time between then and now. And there are a lot of things that could change between now and then that could derail whatever the Fed thinks it may end up doing in September.
But markets are almost universally certain that rate cuts will be beneficial for gold and silver prices.
How You Can Prepare
As we’ve said before, gold and silver have been trusted as safe haven assets for hundreds of years. When times get tough, and people get fearful, gold and silver become some of the most demanded safe haven assets around.
The only thing that seems to be certain about this year is that nothing is certain. From Iran and Israel exchanging missile attacks, banks failing, and now President Trump getting shot, this year has been wild.
And given the possibility of another “October surprise,” can you afford to be caught flat-footed if something crazy happens in the next few months?
Aside from being safe havens and hedges against inflation, gold and silver can be just an all around hedge against uncertainty. They can help diversify portfolios that may be unbalanced or in need of diversification.
And gold and silver can provide peace of mind when things get topsy-turvy, which could very well end up being the case this fall.
When it comes to buying gold and silver, many people prefer the benefits conferred by physical gold and silver coins or bars. Whether it’s through a gold IRA or silver IRA, or through a direct purchase of precious metals delivered to your door, owning physical gold and silver provides a tangible asset that will remain in existence through just about anything short of nuclear war.
Some people prefer to hold their gold and silver at home, making cash purchases of gold and silver a popular choice. They believe that a bird in the hand is worth two in the bush, and that if you don’t have the ability to physically touch your gold and silver, you don’t really own it.
Others want to protect their tax-advantaged retirement savings in 401(k) and similar accounts, and trust gold IRAs and silver IRAs to do that. These precious metals IRAs offer the same tax advantages as any other IRA account, but hold physical gold and silver coins and bars that are stored securely in a bullion depository.
Whichever way you choose to buy gold, Goldco can help. With over $2.5 billion in precious metals placements and thousands of satisfied customers, Goldco has worked hard to establish itself as one of the best and most trusted gold companies in the country.
If you’re worried about what’s coming in the next few months, whether that’s recession, higher inflation, or political instability, maybe it’s time to start thinking about preparing for the future with gold and silver.
Call Goldco today to learn more about how gold and silver can help you safeguard your financial future.
