Gold continues selloff on hot wholesale inflation, hawkish Fed rhetoric
‘Investors’ eternal optimism is shaken.’

(USAGOLD –2/17/2023) – Gold continued its selloff in overseas trading as traders reacted to a hotter-than-expected wholesale price report and two prominent Fed officials suggesting that a 0.5% future rate hike would be justified. It is down $8 at $1830. Silver is down 26¢ at $21.40. Both metals have been in steady downtrends since early February after hitting technical resistance at $1960 and $24.50.

In a Bloomberg report this morning, Oanda Europe’s Craig Elam neatly summarized current investor psychology: “It’s taken a lot but it would appear investors’ eternal optimism is being shaken, with the latest PPI figures finally driving the message home that bringing the economy in for a soft landing will be extraordinarily challenging and there’ll likely be plenty of turbulence along the way,” In the meanwhile, inflation is on the march as are Russian forces in Ukraine; the stock market is in a funk, and US Treasuries are suffering a sharp selloff equal to gold’s.

Gold and US Treasuries
(%, February 2023)

Chart courtesy of TradingView.com