Tuesday saw a noteworthy elevation in gold prices, rising over 1% as investors sought secure destinations for their assets. This occurs in the wake of the US Senate’s approval of a sizable and attractive financial bill, supported by President Donald Trump. The timing of this bill’s approval is significant, as it comes ahead of the July 9 deadline for the implementation of trade tariffs. Gold prices experienced an upward shift of 1.1%, landing at a striking $3,338.24 per ounce – a peak not reached since late June.
In the simultaneously evolving landscape, US gold futures also followed suit by seeing an upswing of 1.3%, concluding at a healthy $3,349.8. The bill in subject is a sweeping one, ranging across tax reductions and expenditure, pursued actively by the Trump administration. In a contrasting move, this bill also pares down the funding allocated to numerous social service programs.
A key insight into the broader implications of the bill comes from the esteemed Marex analyst Edward Meir. He identifies an interesting aspect of the bill: it’s propelling force for gold prices. Meir highlights that the bill might inadvertently lead to an exorbitant deficit of $3 trillion spanning the upcoming decade.
Explaining his viewpoint, Meir suggests that this deficit might have inflationary tendencies to a certain degree, thereby intensifying the financial strain due to increased borrowing and financing. Such circumstances, Meir adds, build a robust foundation for a thriving gold market. Given the inherent value preservation characteristic of gold, it naturally becomes an investment of choice amidst political and financial volatility.
Scott Bessent, the U.S Treasury Secretary, weighs in on the conversation by cautioning nations about the potential escalation in tariffs looming over the July 9 deadline. There could be a significant leap from the provisional 10% tariffs to the previously halted rates oscillating between 11% and 50% under Trump’s regime.
Adding more dimension to the situation is Rhona O’Connell, emerging from her role as the leader of market analysis for EMEA & Asia at StoneX. Contrary to the upward trend, O’Connell predicts an average price of $3000 per ounce for gold during the year’s final quarter, suggesting possibility for an even lower mark by the annual conclusion.
In a parallel stream of developments, Pan American Silver Corp., listed on the NYSE as PAAS, has set plans in motion to procure each issued and outstanding common share of MAG Silver Corp. This acquisition is to be carried out under an arrangement scheme.
MAG Silver Corp. distinguishes itself as a leading silver mining organization, possessing a substantial 44% joint venture stake in the Juanicipio mine. This mine, known for its vast scale and superior grade yet cost-efficient silver yield, is located in Zacatecas, Mexico.
Fresnillo plc, the twin operational arm for the mine, owns a majority 56% share in the same. As part of the impending acquisition deal, MAG shareholders stand to receive an aggregate payout amounting to nearly $2.1 billion.
Breaking this down on per share basis, it rounds off to roughly $20.54 for each MAG share. These developments not only underscore the escalating value of precious metals but also highlight the shifting landscape of investment and finance in challenging times.
The post Gold Prices Soar Amid Investment Uncertainty appeared first on Real News Now.
About Author
