Gold Price Finally Cracks as Economic Gloom Hits Silver, PGMs
Tuesday, 2/25/2025 16:32
GOLD PRICES sank on Tuesday afternoon in London, dropping $60 per ounce to hit 1-week lows 2.2% beneath yesterday's fresh all-time high, as government bond prices rose but silver and the platinum-group metals fell while global stock markets extended their drop amid worsening economic data.
Crude oil and copper prices also dropped hard, hitting new 2025 and 2-week lows respectively.
After new data last week saw
US gold ETF investment inflows jump amid signs of stagflation, yesterday saw the Chicago Fed's National Activity Index edge lower for the 5th time in 6 months.
World No.3 economy Germany then confirmed today that its gross domestic product shrank 0.2% across 2024.
The price of industrially-useful precious metals had already sunk Tuesday, with silver hitting 2-week lows at $31.40 – down $2 from last week's 4-month high – as platinum hit 3-week lows near $960 and
palladium prices plunged to the lowest since early January at $920, down by $100 from early-Feb's 2.5-month high.
Gold then cracked at London's 3pm benchmarking auction, losing 1.1% in the next 30 minutes before falling $10 beneath $2900 per Troy ounce.
That was a new all-time gold price high just 2 weeks ago.
Betting on the Federal Reserve keeping US Dollar interest rates unchanged until July eased again on Tuesday, with betting on 'no change' that month halving from this time a week ago.
Surging bond prices sent 10-year US Treasury bond yields down beneath 4.30% per annum, the lowest since mid-December and dropping by 2/5ths of a percentage point from this point last month.
Comex gold futures also sank, putting the April contract down at $2915 as London bullion then rallied back towards $2900.
That gap – now sitting around $15 per Troy ounce for the past week – jumped as high as $50 last month on fears that the new Trump administration
would include precious metals in its 'universal' trade tariffs.
Spurring a flood of bullion shipments into US warehouses, this
NYLON gold arbitrage has coincided with gold's latest run of new record prices sparking a collapse in demand in gold's major consumer nations.
Shanghai gold prices this morning dropped below London quotes, showing a small discount of $1.40 per Troy ounce and indicating weak demand versus supply in China.
India's gold imports are likely this month to fall to the lowest February figure for at least 2 decades, the Reuters news agency reports,
quoting an un-named government official.
Jewelry sales by Indian giant Titan (NSE: TITAN) will grow as much as 20% in the year starting 1st April, the group's Chief Financial Officer says. But growth will struggle to reach half that level, Ashok Sonthalia also says, "if gold prices keep going up like this [and] it doesn't normalize."
Giant US
gold ETFs the GLD and IAU expanded again on Monday after marking their sharpest weekly growth since Russia began its all-out invasion of Ukraine 3 years ago.
But having previously expanded while those New York-listed trust funds were unmoved until last week, London-listed iShares' ETF the IGLN has now shrunk by 3 tonnes so far in February, while Europe's 2nd largest such gold trust – Invesco's SGLD – has shrunk by 2 tonnes and Germany's No.1 the Xetra ETC is currently unchanged in size.
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