Gold and Silver Face Post-Election Hurdles

Precious metals saw a sharp selloff after Donald Trump’s triumphant election. Despite a dip in gold and silver prices, their long-term potential remains strong. Let’s delve into their current position and the expected path forward.

Gold Experiences Temporary Decline

Although gold prices have risen this year, the post-election scenario has brought some hurdles. The yellow has seen a decrease of over 6.5% following Trump’s victory, contrasting with the U.S. stock market’s 1.5% rise despite worries about the Fed’s rate-cut path ahead. This left gold trading at $2,572 per ounce, down from its recent high of around $2,800 at the end of October. Nevertheless, observers maintain a positive outlook on gold, especially in light of potential policy changes that might lead to heightened U.S. debt and inflation, which could boost the bullion value.

Silver Faces Challenges

Similarly, silver has seen a significant price decline (-7.5%) following the U.S. election, falling back just above the $30 mark. This price drop is partially due to the stronger greenback. The dollar index’s rise, driven by expected tariff adjustments, tends to raise the cost of gold and silver for international buyers, leading to lower demand.

Precious Metals ETFs Performance

Gold ETFs experienced a 3.85% decline last week, resulting in a 27.49% gain year-to-date, while Silver ETFs fell by 2.32%, yet maintained a 32.56% year-to-date increase. Among ETFs, the iShares S&P/TSX Global Gold Index ETF (XGD) and iShares Silver Bullion ETF (SVR) recorded the largest declines, at 8.19% and 2.88%, respectively.

Here’s a comparison between Precious Metals ETFs

Group Data

Funds Specific Data: XGD, CGL, MNT, ZGLD, KILO, MNS, SVR

Please note this article is for information purposes only and does not in any way constitute investment advice. It is essential that you seek advice from a registered financial professional prior to making any investment decision.