Precious Metals

silver price outlook

Catch up and get informed with this week’s content highlights from Charlotte McLeod, our editorial director.


The gold price made it past the US$1,800 per ounce mark this week, rising as high as US$1,810, but sinking to just above US$1,780 at the time of this writing on Friday (October 29).

As next week approaches, attention is shifting to the US Federal Reserve’s upcoming meeting, which will be held from Tuesday (November 2) to Wednesday (November 3).

We’ve previously covered the market’s expectations for this gathering — it’s anticipated that the central bank will share plans to start tapering its bond-buying program, but won’t make a move on interest rates.

Chair Jerome Powell reiterated those ideas recently, saying in a virtual appearance, “I do think it’s time to taper; I don’t think it’s time to raise rates.”

The question for gold market participants is if tapering will mean anything for the yellow metal. We asked our Twitter followers that question a couple of weeks ago, and opinions were split almost 50/50.

Gerardo Del Real of Digest Publishing is one person who firmly believes the upcoming Fed meeting won’t have much impact on gold. Speaking with me this week, he said in his view the central bank’s “double talk” has eroded its credibility so much that it won’t ever return.

“I think the Fed and the policymakers are so full of double talk that the credibility that the institution has lost — I don’t know if it will ever gain it back” — Gerardo Del Real, Digest Publishing

But that’s not to say he isn’t optimistic about gold — although Gerardo admitted that its recent price action has been frustrating, he said he expects a substantial rise in the next six to 12 months.

He pointed out that events don’t have to happen in the order that people expect. In other words, all the fundamentals might be in place right now for gold, but it doesn’t mean we’ll immediately get a price rise.

“Things don’t have to happen in the order we think they will … I think the gold price is going to rise substantially here in the next six to 12 months, and I think that’s going to catch a lot of people off guard” — Gerardo Del Real, Digest Publishing

Moving over to uranium, the market remains very hot. I heard this week from Peter Grandich of Peter Grandich & Company, who’s been bullish on the commodity for about two years now.

The situation has definitely changed in that time, and Peter suggested that while the easy gains may be over, the market is still only in the third or fourth inning out of nine.

“I still believe (uranium) has a lot higher to go, but I believe … the easiest money has been made” — Peter Grandich, Peter Grandich & Company

With his comments in mind, we asked our Twitter followers this week if they’ve taken any profits off the table when it comes to uranium. By the time the poll closed, the answer was a resounding “no.”

We’ll be asking another question on Twitter next week, so make sure to follow us @INN_Resource or follow me @Charlotte_McL to share your thoughts.

Going back to Peter’s thoughts on uranium, he said since the number of companies out there is so small, he’s always been an advocate for looking at the larger players first before moving down to explorers.

He also warned that as the uranium space heats up even further, new entrants will start to emerge. While a rising tide can lift all boats, Peter said it’s important to remember that utilities can’t do deals with companies that aren’t producing.

“The problem is for the utility companies they can’t speculate and make a deal with somebody that may have a uranium mine built and in production in the next five to seven years — they have to go to the handful of producers” — Peter Grandich, Peter Grandich & Company

Want more YouTube content? Check out our YouTube playlist At Home With INN, which features interviews with experts in the resource space. If there’s someone you’d like to see us interview, please send an email to cmcleod@investingnews.com.

And don’t forget to follow us @INN_Resource for real-time updates!

Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

Editorial Disclosure: The Investing News Network does not guarantee the accuracy or thoroughness of the information reported in the interviews it conducts. The opinions expressed in these interviews do not reflect the opinions of the Investing News Network and do not constitute investment advice. All readers are encouraged to perform their own due diligence.

MARKETS

Markets
TSX19969.19-4.03
TSXV581.74-2.20
DOW33781.48+183.56
S&P 5003963.51+29.59
NASD11082.00+123.45
ASX7175.50-53.90

COMMODITIES

Commodities
Gold1796.85+7.75
Silver23.28+0.20
Copper3.92+0.03
Palladium1924.50+11.51
Platinum1017.50+10.50
Oil71.98+0.52
Heating Oil2.880.00
Natural Gas5.87-0.10

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