Why Today's Gold and Silver Prices Matter

Today’s gold and silver prices started off on an upswing.

Yet they’re still not even close to how high they could be by the end of the year. 

While the market rallied yesterday on news that the U.S. and China were making headway in trade negotiations, it stalled this morning after fresh data from the Labor Department indicated inflation picked up in April.

As reported in Bloomberg, inflation slightly accelerated in April after an unexpected cooldown the previous month.

The consumer price index is seen rising 0.3% from March after declining in the prior month, according to the median forecast in a Bloomberg survey of economists. 

Most forecasters say Tuesday’s report by the Bureau of Labor Statistics will show the first signs of the punishing tariffs implemented on China last month as well as other duties. The impact may be limited because many imported goods on US shelves last month arrived in the country before the new levies came into effect.

We won’t see the full impact of these tariffs until next month, but even the slightest indication that inflation will pick up this year is quite bullish for gold, which has been on a steady climb since 2016.  

Over the past 9 years, gold prices have soared nearly 200%.  

And this run may not even be close to done. In fact, gold could soon hit $4,000.

How to Profit from Today’s Gold and Silver Prices

Last month, JP Morgan put out an investor note suggesting that gold prices will cross $4,000 per ounce.  This, based on increased recession probabilities as a result of Trump’s trade war. 

Analysts from the investment bank expect gold to clock in at around $3,675 this year, then exceed $4,000 an ounce by Q2, 2026.

Of course, it’s still hard to know exactly how this trade war is going to play out.  If it does end this year, then I suspect that $4,000 price target may not come to fruition.  In that scenario, the run on gold comes to an end.  Although silver prices could continue to run. 

You see, silver tends to run in tandem with gold.  Over the past 9 years, the noble metal is up 135%.  But it’s important to remember that silver also benefits from being an industrial metal, not just an investment-grade metal (i.e. – coins, jewelry, etc.). 

Interestingly, silver’s balance between being an investment-grade metal and industrial metal has historically been around 50/50.  But today, as a result of rapidly growing markets that require large amounts of silver to operate, silver now represents about 60% of total demand. So anytime you see weakness in silver, you might want to start buying.  A few solid silver stocks to consider include …

• Pan American Silver Corp. (NYSE: PAAS)
• MAG Silver Corp. (NYSE: MAG)
• Silvercorp Metals (NYSE: SVM)

From solar panels and EVs to AI and cryptocurrency, these markets are heavily reliant on a steady supply of silver. And in the absence of a trade war, these four markets are primed for significant, long-term growth.  So invest accordingly. 

Jeff

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