Craig Hemke, Founder and Editor of TF Metals Report, joins us to review the recent corrective move in the precious metals sector, and what macroeconomic factors could create a scenario that is constructive for more sustained moves higher starting the second half of this year. We reflect on the recent Fed meeting, and stronger-than-expected jobs and manufacturing numbers, but note how those trends could change once the Fed pauses it’s tightening, and the effects of the higher interest rates further contract the economy.
We ask Craig what it will finally take to for more generalist to wake up to the central bank perpetual cycle of hiking only to cut again, and what catalysts may take the PMs on a longer term trajectory higher. This takes the discussion into the Fed pausing, trends in unemployement, the direction of inflation, and interest rates.
Craig points out that regardless of how it plays out, it will be key for investors to ignore some of the short-term micro noise, and instead focus on the longer-term macroeconomic data and trends. He still feels the odds are the first half of the year will remain choppy, but that the latter half of the year may be similar to 2010 or 2019 where the Fed is eventually forced to start cutting again due to weakened economic conditions. His advice is to hold through any volatility in the near-term, expecting a more positive advance in gold, silver, and the PM mining stocks in the second half of the year.
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