Trump Victory at Polls Set to Boost Gold & Silver Prices Significantly
Precious metals analysts at leading precious metals supplier Heraeus said that the possibility of Trump winning the election in November is prompting global investors to consider turning their eyes to $Gold - main 2408(GCmain)$ , as both gold and $Silver - main 2409(SImain)$ prices stand to benefit from tariffs and trade disputes.
In Heraeus' latest precious metals report, analysts noted that Trump's second term could push global investors to deploy some of their money in gold.
Investors sought gold as a safe haven asset. Global ETF holdings increased from 71 million ounces at the end of 2017 to 86 million ounces at the end of 2019, and U.S. ETF holdings increased from 37 million ounces to 44 million ounces.
In addition, if Trump takes office, he may also replace Powell with a dovish candidate when his term ends in 2026, and may appoint a number of members of the Federal Open Market Committee (FOMC) who favor easy monetary policy.
It is conceivable that a more dovish Fed would accelerate rate cuts and loosen its grip on inflation, weakening the dollar and increasing investor demand for gold. "Any move to manipulate the Fed's executive powers could shake market confidence in U.S. monetary policy and further boost gold prices," the report said.
Coupled with the strong demand for precious metals in the Asian market, especially in the two big countries of China and India, the demand for gold, both central bank and consumer retail demand continues to climb, which has played a key role in stabilizing the gold price.
In addition to gold, Heraeus believed:
The expansion of solar manufacturing in the United States coupled with increased trade barriers could boost domestic silver demand. In the first quarter of 2024, the United States added 11 gigawatts of new solar module capacity, driven by heavy investment spurred by the Inflation Reduction Act.
According to the Silver Association, demand for solar photovoltaic power generation is expected to hit a record high this year, exceeding 230 million ounces, equivalent to 19% of the world's total silver use.
In addition, expanding electric vehicle charging infrastructure is also a focus area of U.S. government subsidies, and large-scale electric infrastructure roll-out requires the use of silver in connectors and various components.
The silver market has seen modest upward momentum this week, with spot silver prices trading at $29.552 an ounce before the close on Wednesday (July 3), up 0.35%.
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