Gold, silver rally as metals bulls gain momentum

Gold and silver futures prices are sharply higher and near their daily highs at midday Wednesday, on chart-based buying and bets being placed on “the inflation trade.” U.S. stock indexes that hit new record highs today did not stand in the way of the metals market bulls. Gold and silver prices have rebounded well off this week’s lows to suggest both metals have put in near-term bottoms. February gold futures were last up $24.30 at $1,864.60 and March Comex silver was last up $0.41 at $25.73 an ounce.

The highlight of the U.S. trading day was the presidential inauguration of Democrat Joe Biden. Biden will be reversing many of outgoing President Trump’s executive orders. Biden and his Democrat-controlled Congress are also set to roll out big spending plans that could further lay the seeds for problematic price inflation down the road. Incoming U.S. Treasury Secretary Janet Yellen on Tuesday told lawmakers that going “big” on spending is needed to begin to repair the severe economic damage caused by the pandemic. This has the “inflation trade” bulls licking their chops at present.

Global stock markets were mixed but mostly higher overnight. Aside from the inauguration, it’s a big corporate earnings week in the stock market.