U.S. Treasury Secretary Endorses Lower Dollar: Gold and Silver Surge
The spot price of gold and silver both moved up more than 1% in early afternoon trading on January 24 after comments by Steven Mnuchin, U.S. Treasury Secretary, in Davos. The comments were made at the ongoing World Economic Forum (WEF) which is hosted in Davos, Switzerland.
“Obviously a weaker dollar is good for us as it relates to trade and opportunities,” he told reporters in Davos. “Longer term, the strength of the dollar is a reflection of the strength of the U.S. economy and the fact that it is and will continue to be the primary currency in terms of the reserve currency.”
The comments come on the eve of the arrival of U.S. President Donald Trump. Trump is expected to deliver an “America First” speech to the WEF. Populist rhetoric aside, Trump has largely followed the traditional GOP line in his first term; pursuing repeal of the Affordable Care Act and U.S. tax reform.
Silver moved up over 3% as of early afternoon trading, above the $17.40 mark. Gold also rose 1.3% to $1,360. It is the first time gold has breached this mark since early September. The rapid decline of cryptocurrencies have also reportedly resulted in a flight to precious metals for some holders looking to shift to another speculative asset.
In the aftermath of a short-lived government shutdown and what is promised to be a tumultuous political year in the U.S. with both immigration policy and NAFTA on the line, gold and silver seem promising.