Gold continues to march toward $3,000. Silver remains below last week's high at $33.34.

OUTSIDE MARKET DEVELOPMENTS: President Trump is considering returning 20% of DOGE savings to American taxpayers and using 20% to pay down debt. DOGE claims that total estimated savings thus far is $55 bln although many claim that figure is inflated.

While I think there are certainly more savings to be found in our bloated federal government, it won't make a dent in a national debt that's now north of $36 trillion. I suppose we have to start somewhere...

The House and the Senate are each advancing separate budget proposals. Trump has thrown his support behind the House's "one big, beautiful bill" approach, with large reductions in both taxes and spending.

The House proposal allows for $3.3 trillion in net deficit increases over 10 years and a $4 trillion increase in the debt limit. While there will be a reconciliation process, I don't see how this proposal honors the President's pledge to balance the budget.

The Senate budget legislation also lacks the comprehensive revenue increases or spending reductions needed to eliminate deficits. Senate Budget Committee Chair Lindsey Graham said he’s “pulling for the House to pull it together," but pointed out that the House bill doesn't make the tax cuts permanent.

Minutes from the January 28–29 FOMC meeting were released yesterday and reflected a high level of uncertainty. Contributing factors to that uncertainty were "reduced downside risks to the outlook for the labor market and economic activity, increased upside risks to the outlook for inflation, and uncertainties concerning the neutral rate of interest, the degree of restraint from higher longer-term interest rates, or the economic effects of potential government policies."

"Business contacts in a number of Districts had indicated that firms would attempt to pass on to consumers higher input costs arising from potential tariffs," according to the minutes. This reinforces broad expectations that tariffs will contribute to inflationary pressures.

The minutes confirm that the Fed is inclined to remain on hold until more progress is made on inflation. Fed funds futures continue to suggest the September FOMC meeting as the most likely timing for the next 25 bps rate cut. 

Safe-haven assets will continue to benefit from trade tensions, and the attendant global uncertainties and price risks. However, persistent optimism about the U.S. economy has generally underpinned risk appetite.

Philadelphia Fed Index tumbled 26.2 points to 18.1 in February, below expectations of 20.0, versus a nearly three-year high of 44.3 in January. "The indicators for current activity, new orders, and shipments remained elevated. On balance, the firms indicated an increase in employment, and the price indexes remained above their long-run averages," according to the report.

Initial Jobless Claims rose 5k to 219k in the week ended 15-Feb, above expectations of 215k, versus a revised  214k in the previous week. Continuing claims rose 24k to1,869k in the 8-Feb week from 1,845k in the previous week,

Leading Indicators fell 0.3% 101.5 in January, below expectations of unch, versus -0.1% in December. The gains in November and December remain the only increases since Feb'24.


GOLD

OVERNIGHT CHANGE THROUGH 6:00 AM CST: +$15.36 (+0.52%)
5-Day Change: +$13.20 (+0.45%)
YTD Range: $2,607.16 - $2,954.53
52-Week Range: $2,016.41 - $2,954.53
Weighted Alpha: +43.19

Gold notched a second new all-time high for the week as trade tensions continue to drive haven interest. A new 10-week low in the dollar index is providing support as well. Comments this morning from Treasury Secretary Bessent on gold revaluation knocked the yellow metal off its highs, but that dip is attracting further buying interest.



There's been a fair amount of buzz in recent weeks about the possible revaluation of U.S. gold reserves from the legacy statutory price of $42.22 an ounce to a more realistic figure. Such a move would likely provide a floor for the gold price and help perpetuate the dominant uptrend.

When asked about it on Bloomberg, Secretary Bessent said, "I promise you, that’s not what I had in mind.” While perhaps disappointing to gold bugs, his statement doesn't undermine the uptrend.

President Trump and Elon Musk have revived decades-old questions about U.S. gold reserves. "We’re going to go to Fort Knox and make sure the gold is still there,” vowed Trump on Wednesday. “If the gold isn’t there we’re going to be very upset,” he added.

Today, Treasury's Bessent assured Americans that U.S. gold reserves are right where they're purported to be. “All the gold is there,” he said.

Elon Musk is in favor of an audit. "Maybe it’s there, maybe it’s not. That gold is owned by the American public! We want to know if it’s still there," he wrote on X this week. 

Bessent claimed “We do an audit every year,” seemingly dispelling a widely held belief that the last audit of the gold in Fort Knox occurred in 1974. The trade is going to want some detail on those alleged annual audits. 

Bessent did not address concerns that there are lease claims on those reserves.

Today's overseas high at $2,954.53 now defines an intervening barrier ahead of the targeted $3,000 level. Beyond that, the next Fibonacci level comes in at $3,037.94.

The intraday low from early U.S. trading at $2,927.49 marks first support and protects yesterday's low at $2,919.83. Tuesday's low at $2,894.21 stands in front of more significant support at $2,880.05/$2,878.68.

Silver continues to struggle on upticks above $33, leaving the fifteen-week high set last week at $33.340 protected. More record highs in gold and a soft dollar are providing support, but global trade and growth concerns continue to pose a headwind.



A close above $33 would bolster confidence in the bullish scenario, favoring a breach of chart/Fibonacci resistance at $33.340/$33.554. Such a move would return focus to last year's high at $34.853.

An intraday chart point at $32.869 protects the low for the day at $32.651. A retreat below $32 from here would be troubling for the bull camp.


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.