Blog posts of '2025' 'September'

Gold surges to record highs as silver reaches 14-year highs near $41

Outside Market Developments: U.S. markets begin September with sentiment tilted toward a risk-off stance. 
Tariff uncertainties, Fed rate cut expectations, sticky inflation, and upcoming economic data are all contributing to diminished risk appetite.

A federal appeals court ruled on Friday that most of the Trump administration's tariffs are illegal. The levees remain in place as the White House looks to the Supreme Court to settle the matter. If SCOTUS agrees to hear the case, initial arguments likely won't be heard until early 2026.

If SCOTUS refuses to hear the case or upholds the appeals court ruling, the $172.1.bln of tariff revenue collected thus far may have to be refunded. Treasuries are under pressure as the trade prices in heightened fiscal risks, and stocks are under pressure.

"[W]ith the help of the United States Supreme Court, we will use [tariffs] to the benefit of our Nation, and Make America Rich, Strong, and Powerful Again," wrote President Trump on TruthSocial. Negotiations with several key trading partners are ongoing, although the appeals court ruling throws a new wrinkle into the talks, stoking uncertainty.

The S&P Global Manufacturing PMI composite index reached a new high for the year in August, although other data today were less than encouraging to the narrative of a resilient U.S. economy. There were also troubling signs of reviving inflation within the PMI data. "Tariffs caused sharply higher costs that led to the steepest rise in average selling prices in three years," according to S&P.

"Companies have passed tariff-related cost increases through to customers in increasing numbers. The resulting rise in selling prices for goods and services suggests that consumer price inflation will rise further above the Federal Reserve's 2% target in the coming months."

At this point, Fed funds futures continue to reflect a market belief that the Fed is poised to resume its easing campaign this month, having been on pause since the beginning of the year. That could change if further signs of accelerating inflation become evident. PPI and CPI for August will be released next week, and median expectations for both are for modestly warmer readings.

The trade is currently focused on Friday's jobs report. More weak jobs data could seal the deal on a 25 bps rate cut in September. While the pre-FOMC blackout period is underway, I still see some risk that the Fed asserts its independence by holding steady. Upcoming data may provide them cover to do just that.

Before the next FOMC meeting, President Trump will try to get Stephen Milar confirmed to the Fed governor seat vacated by Adriana Kugler's resignation. Meanwhile, Governor Lisa Cook remains in her position, pending a hearing today in U.S. district court, where she could be granted injunctive relief.

S&P Global Manufacturing PMI was revised down to 53.0 in August from a preliminary reading of 53.3, versus 49.8 in July.  That's still the highest print since May 2022.

Manufacturing ISM rebounded 0.7 points in August to 48.7 on expectations of 48.8, versus 48.0 in July. Prices moderated to 63.7, versus 64.8 in July.

Construction Spending fell 0.1% in July, inside expectations of -0.2%, versus -0.4% in June.

RCM/TIPP Economic Optimism Index retreated 2.2 points to 48.7 for September, well below expectations of 51.8, versus 50.9 in August. “Concerns about inflation and the impact of tariffs remain high, with food prices standing out as the leading economic worry,” according to the report.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CT: +$9.45 (+0.27%)
5-Day Change: +$87.93 (+2.59%)
YTD Range: $2,607.16 - $3,508.20
52-Week Range: $2,474.08 - $3,508.20
Weighted Alpha: +38.38

Gold has extended to new all-time highs above $3,500, spurred by heightened tariff uncertainties, inflation worries, rumors about President Trump's health, and a technical breakout. The yellow metal is trading higher for a sixth straight session and is now up nearly 35% year-to-date, shrugging off higher yields and a stronger dollar.



Late-August/early-September is also when gold typically sees a seasonal increase in volatility as the summer doldrums wind down. The symmetrical triangle that formed over the summer months was viewed as a continuation pattern, favoring an eventual upside breakout of the range. 

Sights are now on the $3,601.32 Fibonacci objective. Above that, a measuring objective off the symmetrical triangle breakout suggests potential to $3,743. Considerable credence has also been returned to the long-standing target of $4000.

Former resistance at the $3,508.20/$3,500.00 zone now marks initial support, and should keep today's overseas low at $3,470.62 at bay. The yellow metal has really pulled away from the 20-day moving average, which is well protected at $3,380.77.


SILVER

OVERNIGHT CHANGE THROUGH 6:00 AM CT: -$0.213 (-0.52%)
5-Day Change: +$1.707 (+4.42%)
YTD Range: $28.565 - $40.849
52-Week Range: $27.732 - $40.849
Weighted Alpha: +46.43

Silver has extended to fresh 14-year highs near $41, after cracking the $40 threshold on Monday. The technicals and fundamentals remain broadly supportive.



The breach of the $40.396 Fibonacci objective bolsters confidence in the scenario that calls for a challenge of the $41.513/$41.610 zone. Above that, record highs near $50 would very much be in play. The $43.352 (Sep'11 high) and $44.167 (Aug'11 high) mark important intervening chart barriers.

Minor support at $40.885/754 protects today's early U.S. low at $40.148. Additional downside barriers are noted at $40 and $39.574 (Monday's low).


Peter A. Grant
Vice President, Senior Metals Strategist
Zaner Metals LLC
312-549-9986 Direct/Text
[email protected]
www.zanermetals.com

Non-Reliance and Risk Disclosure: The opinions expressed here are for general information purposes only and should not be construed as trade recommendations, nor a solicitation of an offer to buy or sell any precious metals product. The material presented is based on information that we consider reliable, but we do not represent that it is accurate, complete, and/or up-to-date, and it should not be relied on as such. Opinions expressed are current as of the time of posting and only represent the views of the author and not those of Zaner Metals LLC unless otherwise expressly noted.