If you’re hoping red-hot inflation will cool down significantly in the coming months, you’re probably going to be disappointed if producer prices provide any indication.
The dollar has been on a tear in recent months. Just last week, the dollar index moved from 107 to 108 with an inter-week high of 109.3. The greenback also hit parity with the euro last week. The dollar is near a 20-year high compared to the European currency and a 24-year high against the Japanese yen.
And yet we have a massive devaluing of the dollar domestically. In his podcast, Peter tries to make sense of this tale of two dollars.
It happened again. The CPI data for June came in hotter than expected. Prices rose at the fastest pace in this inflationary cycle. That pushes the Fed ever closer to having to make a very difficult choice. In this episode of the Friday Gold Wrap, host Mike Maharrey breaks down the most recent CPI data and talks about the “Sophie’s choice” facing the Federal Reserve.
Fed Chair Jerome Powell and other members of the central bank have continued to talk tough about fighting inflation. But I’m pretty certain that in private, they were desperately hoping to see some cooling in the inflation data so they could start backing out of the ring. With a recession pretty clearly on the horizon (if not already here), you can bet that the central bankers don’t want to keep tightening monetary policy.
They didn’t get their wish.
The latest seasonally adjusted inflation rate for June came in at a blistering 1.35% MoM and 9.11% YoY, beating expectations of 1.1% and 8.8% respectively. All prices rose in May with 8 of 11 categories rising faster than the 12-month trend, representing 94.7% of the total CPI.
Silver has dipped below $20 an ounce for the first time in two years. But given silver’s fundamentals, the current economic dynamics, and the trajectory of the Fed, silver appears very oversold.
For the next week, you can take advantage of the lowest silver spot price in years, and we’ll even sweeten the deal with free silver with qualifying orders.
There are three good reasons you should take advantage of silver on sale.
The Federal Reserve is putting on quite the tough guy act. Everybody is convinced the central bank is going to keep up the inflation fight even if the economy gets shaky. In this episode of the Friday Gold Wrap podcast, host Mike Maharrey talks about the Fed’s hawkish messaging and wonders out loud if the central bankers are writing checks they can’t cash.
After the June FOMC meeting and the Fed’s 75- basis point interest rate hike, I argued that the central bank is totally winging it. Reading between the lines in the minutes from that June meeting seems to bear this out. The Fed appears to be in reaction mode. The question becomes what will it react to next? How long will the hawks keep flying as the economy tanks?
On July 1, the Federal Reserve Bank of Atlanta lowered its Q2 GDP projection to -2.1%, officially forecasting a recession.
So, much for Jerome Powell’s “soft landing.”
Federal Reserve Chairman Jerome Powell continues to insist that the economy is strong enough to withstand tighter monetary policy to fight inflation. But the economy seems to be saying otherwise. So, how will this play out? In this week’s Friday Gold Wrap podcast, host Mike Maharrey gazes into his crystal ball and speculates about what might happen over the next several months. He also tells the tale of two central bankers and discusses the current gold market.
