A Precious Metal Pulse Check

Precious metals have, after a year of perpetual ‘up’, seen some recent fluctuations amid some of the highest equity market turbulence seen in recent history. With the US economy gapping down under the weight of new tariffs announcements, we discuss.

Gold is trading at AU$4981 per ounce as of this morning, down slightly from last week’s peak of AU$5,166. The metal’s performance stems from its inverse dance with the US dollar, which hit a 2025 high on the Dollar Index (DXY) at 102.8 following robust US jobs data released April 4. Strong employment figures—adding 215,000 jobs in March—have tempered expectations of Federal Reserve rate cuts, pushing Treasury yields up to 4.1% and bolstering the dollar. Gold, a non-yielding asset, typically wilts under such pressure, yet it’s holding firm as investors hedge against looming trade wars.

US President Donald Trump’s latest tariff, announced April 2, slapped 25% duties on European and Chinese imports, sparking fears of retaliatory measures. Financial markets shed over 1 trillion in value last week.

Silvers, at AU$50.25 per ounce, is down from last week’s AU$55 high, reflecting its tug-of-war between industrial demand and economic headwinds. The metal’s 7% year-to-date gain is under threat as China’s manufacturing PMI slipped to 49.8 in March, signalling contraction and dampening hopes for a robust industrial recovery. Silver’s critical role in solar panels—demand up 12% in 2025, per the Silver Institute—offers a lifeline, but Trump’s tariffs threaten to crimp global supply chains, hitting silver harder than gold.

The gold-to-silver ratio sits at 99:1, near a five-year high, underscoring silver’s lag. Chatter points to a potential “Silver Squeeze 2.0” if industrial demand rebounds.

The Fed’s call, China’s output, and tariff fallout will decide the next price direction for gold and silver. Right now, they’re a straight-up gauge of a shaky economy.