tl;dr
Gold and Silver Poised for a Surge as Fed Rate Cuts Loom, Analyst Says
Mark Newton, head of technical strategy at Fundstrat, is betting big on a gold and silver rally, forecasting both metals could hit record highs by October. His reasoning? A wave of Federal Reserve rate cuts, which he believes ...
Gold and Silver Poised for a Surge as Fed Rate Cuts Loom, Analyst Says
Mark Newton, head of technical strategy at Fundstrat, is betting big on a gold and silver rally, forecasting both metals could hit record highs by October. His reasoning? A wave of Federal Reserve rate cuts, which he believes are imminent and could transform the precious metals market.
Newton’s optimism stems from a mix of technical indicators and macroeconomic signals. “Gold and silver are bottoming today and should make a beeline toward the highs between now and October,” he told Fox Business, emphasizing that the timing aligns with seasonal trends favorable to metals. His analysis hinges on the Fed’s expected pivot: four rate cuts between now and next summer, a shift that could weaken the U.S. dollar and boost demand for gold and silver as safe-haven assets.
The Fed’s stance has been gradually softening. Earlier this week, Chair Jerome Powell hinted at rate cuts in September, a move CME Group has dubbed “overwhelmingly likely.” Powell’s remarks at a recent economic symposium underscored the central bank’s cautious approach: “Our policy rate is now 100 basis points closer to neutral… the baseline outlook and shifting balance of risks may warrant adjusting our policy stance.” This language, while measured, signals a potential easing cycle that could embolden investors.
Newton isn’t just eyeing the metals for their price potential—he’s framing them as a diversification play. “For those too top-heavy in software, look at the precious metals,” he said, acknowledging that while silver isn’t technically a “precious metal,” its role in industrial demand and inflation hedges makes it a compelling bet.
The logic is straightforward: lower interest rates reduce the return on bonds and other fixed-income assets, making gold and silver more attractive. Meanwhile, real rates—the cost of borrowing after inflation—have been declining, further fueling the case for metals.
So, is this a golden opportunity? Newton’s bullish stance is clear, but history shows that rate cuts and metal prices aren’t always perfectly correlated. Still, with the Fed’s credibility and the metals’ historical role as inflation hedges, the stage is set for a potential showdown between the dollar and the shine of gold and silver.
As investors weigh their options, one question looms: Are you ready to ride the next bull run in precious metals—or will you wait for the first spike?