Precious metals surged once again in response to Fed Chair Jerome Powell‘s recent statements hinting at potential monetary policy easing in 2024, contingent upon further positive data on inflation and growing confidence that price pressures will align with the 2% target.
Gold prices, as gauged by the SPDR Gold Trust GLD, soared 0.8% to $2,150/oz during midday trading in New York, surpassing the previous peak of $2,146/oz set in December 2023. The yellow metal is now on track for its seventh consecutive day of gains.
Similarly, silver experienced a notable 2.2% rally, reaching $24.20/oz, its highest level since the end of December 2023. Since the beginning of the month, both gold and silver have seen impressive gains of 5% and 6.4%, respectively.
Treasury yields extended their decline on Wednesday, with the 10-year yield falling to 4.1%, marking its lowest level in a month. Similarly, longer-dated 30-year yields dropped by 5 basis points to 4.25%, the lowest since early February.
The U.S. dollar index (DXY), as tracked by the Invesco DB USD Index Bullish Fund ETF UUP, fell by 0.5%, on track for its worst session in 2024.
In response to queries regarding the timing of potential Fed rate cuts, Powell remarked, “We are not expecting inflation to necessarily hit the 2% mark, but we do require further evidence.” Powell emphasized the anticipation of a continued decline in 12-month inflation readings.
The Fed Chair dismantled fears of an imminent recession and stated that commercial real estate risks are ‘manageable.’
Markets reflect expectations of four rate cuts by December 2024, with a 73% probability assigned to the first rate cut potentially occurring as early as June.
Chart: Gold Prices Reach Record Highs
Mining Stocks Rally Wednesday
The significant upticks in both gold and silver sparked a vigorous rally among mining stocks on Wednesday.
The VanEck Gold Miners ETF GDX rose 2.5%, poised for a fifth straight days of gains, reaching the highest since mid-January.
The VanEck Junior Gold Miners ETF GDXJ surged 2.4%, showing a similar trend.
| Name | 1-Day % | Market Cap |
| Ivanhoe Electric Inc. IE | 12.03% | $ 1.05B |
| Contango Ore, Inc. CTGO | 8.63% | $ 186.97M |
| Vista Gold Corp. VGZ | 7.27% | $ 53.25M |
| Coeur Mining, Inc. CDE | 6.19% | $ 1.19B |
| Austin Gold Corp. AUST | 5.73% | $ 13.15M |
| DRDGOLD Limited DRD | 4.88% | $ 684.89M |
| Gold Resource Corporation GORO | 4.70% | $ 24.48м |
| Hycroft Mining Holding Corp. HYMC | 3.7% | $ 41.31M |
| Freeport-McMoRan Inc. FCX | 3.61% | $ 55.17B |
| Hecla Mining Company HL | 3.40% | $ 2.43B |
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