Daily Gold Market Report

Gold pushes lower as investors remain on the defensive
Dimon, Pozsar warn of further problems in the banking system

(USAGOLD – 5/23/2023) – Gold pushed lower this morning as uncertainty prevailed over the debt ceiling, bond yields rose, and investors remained on the defensive over further problems in the banking system. It is down $14 at $1960. Silver is down 44¢ at $23.24. With bond yields rising, JP Morgan’s Jamie Dimon worries about further problems in the banking industry centered around commercial real estate loans. “I think everyone should be prepared for rates going higher from here,” he said yesterday at the bank’s investor conference. Dimon went on to say that “lenders should be prepared for benchmark lending rates to climb as high as 7%,” according to a report posted at Markets Insider.

Similarly, former Credit Suisse managing director Zoltan Pozsar described the turmoil at US banks as “basically lessons in not being able to run interest rate risk, not knowing how to make a loan that will be weathering a rising interest rate storm.” He cryptically added that the Fed is only addressing “half the problem” and likened its current rescue regime to “foaming the runway for any large banks that might be having problems.” [Source: Bitcoin Magazine]

line chart showing the rising yields on the 10-year Treasury
Chart courtesy of TradingEconomics.com

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