Fed Plans Fewer Rate Cuts in 2025
Michael Maloney

Gold prices rose Friday but remained on track for a weekly decline of 1-2%, pressured by the Federal Reserve's more hawkish stance on interest rates.

The Fed's latest projections showed fewer rate cuts planned through 2025 than previously expected, with officials now forecasting just two quarter-point cuts instead of the four cuts suggested in September.

While markets digest the Fed's hawkish shift, another source of uncertainty emerges from Washington...

US Government Faces Shutdown Over Funding Bill 

Another government shutdown looms as House lawmakers rejected a stopgap funding measure Thursday evening, voting 174-235 against the bill despite former President Trump's endorsement. House Republicans now race against a Friday deadline to draft and pass new legislation.

Government shutdowns, once considered politically taboo by both Democrats and Republicans, have evolved into a common legislative weapon in modern Washington.

Adding to the complex economic picture, new inflation data released this week showed mixed signals...

Fed's Preferred Inflation Gauge Shows Mixed Signals in November 

The Personal Consumption Expenditures (PCE) price index rose just 0.1% for the month, below expectations, while the annual rate edged up to 2.4% from October's 2.3%, remaining above the Fed's 2% target.

Core PCE inflation, which excludes volatile food and energy prices, held steady at 2.8% year-over-year. While both figures came in below economists' forecasts, they reveal persistent underlying inflation despite aggressive monetary tightening.

The PCE index, however, tells only part of the inflation story. While favored by the Fed for its broader economic scope, including healthcare spending and indirect purchases, it often understates the price pressures consumers experience in their daily lives.

The Consumer Price Index (CPI), which focuses on out-of-pocket expenses, typically runs 0.3 to 0.4 percentage points above PCE for core measures, better reflecting costs faced by many Americans.

Despite November's modest monthly increase, Fed officials remain cautious about declaring victory over inflation, projecting price pressures could persist above target well into 2025.

Looking ahead to the precious metals market in the coming year...

Saxo Bank Predicts Silver Will Outshine Gold in 2025 

Saxo Bank's latest report highlights silver's potential to outperform gold in the coming year, citing the metal's unique position in both precious and industrial markets.

The analysis points to silver's strong performance in 2024, driven by surging demand from renewable energy and electronics sectors, combined with persistent supply deficits.

While silver has largely tracked gold's movements due to macroeconomic uncertainties, Saxo Bank suggests that growing industrial applications could push silver prices even higher relative to gold in 2025.

With persistent inflation, political uncertainty, and promising forecasts for precious metals, now may be the perfect time to strengthen your portfolio.

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Michael Maloney is host of the smash-hit video series Hidden Secrets of Money, author of the bestselling precious metals book Guide to Investing in Gold and Silver, and founder of GoldSilver.com, one of the world's most highly regarded investment education companies and a global leader in gold and silver sales. For more than a decade, he’s traveled the world sharing his relentless passion for economics and monetary history with audiences from Silicon Valley to Wall Street, from Hong Kong to Rome.

As he delved into financial markets, monetary history, and global economics, Mike discovered that the same economic cycles kept repeating over and over throughout history, from ancient times to modern day. "For 2,400 years as people have lost faith in fiat currencies, they have turned to 'real money,' gold and silver," Mike says. "Today the stage is set for a worldwide 'gold rush' to the safe haven of precious metals just when supplies of those metals are precariously low. The opportunity for those who position themselves accordingly, ahead of the crowd, is like none we will see again in our lifetimes.

 

 

 

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