Metals Minute 131: Fed Fighting Inflation Announcement Day

Silver and palladium are moving higher this morning, as Federal Reserve Chairman Jerome Powell likely indicates they are keeping their eyes on lowering inflation in the months ahead. While interest rates are still negative in real terms, it may help to talk about raising rates further.

In any event, we have income, spending, and core inflation numbers to report that was released at 7:30 AM CST this morning. Incomes for the month were up 0.2% but were expected to be up 0.6%. Spending increased 0.1% for the month but was expected to increase 0.5%. And core PCE inflation came in at +0.1% month over month and +4.6% year over year.

While there are signs of costs coming down in some areas, they continue to climb in others. Energy/utility costs are squeezing consumers and companies worldwide, with European electricity costs exceeding $1,000 per Kilowatt Hour in some cases. This has a similar effect to $4-500 per barrel of oil here in the US. Also, 20 million Americans are overdue on their utility bills and unable to pay. Inflation + recession = stagflation = time to own gold and silver.