Silver Comment, Debt Ceiling, AI Bubble, Gold Levels
Zen Moment: The Girl has Skills
1- Market Rundown
Good Morning. The dollar is down 27. Bonds are stronger with the 10 year yield down 4bps. Stocks are all up between 20 and 60 bps. Gold is up $9. Silver is up 40c ( significant compared to stocks and Gold and moving like Copper more). Copper is up 2%. Oil is up 75c. Nat Gas is up 13c. Crypto is mixed. Grains are up 50- 100 bps. People are squaring for PCE right now.
Refinitiv on PCE
On the U.S. economic tap, the Commerce Department is expected to release personal consumption expenditures (PCE) price index figures for April. Excluding the volatile food and energy components, the PCE price index is likely to rise 0.3%, matching the gain in March.
The core PCE price index was likely unchanged at 4.6% on a year-on-year basis in April. Consumer spending likely rose 0.4% in April, after remaining flat in March. Personal income likely climbed 0.4% in April, after rising 0.3% in the month before.
2- Silver, the Debt Ceiling, and the AI Bubble
First off, Shanghai is actually buying the Silver dip concurrent with their vaults being depleted. This forces us to rethink their trading role as less hot money, more patient money. Recall they bought the highs in Gold 2 weeks ago.
Our tracking of the top ten participants long and short in Shanghai suggests that Chinese participants are back on the bid in precious metals. This is occurring concurrently with largescale withdrawals from SHFE warehouses- - more from TD at bottom
Three macro factors are aligning with some secular views now. China Solar demand is growing, Chinese financial traders are as important as Western, and (based on the newfound Chinese patience and countercyclical activity) someone smart is brokering Chinese purchases.
