Jerome Powell Gives “All-Clear” Signal for Gold & Silver to Rally

Well, Fed Chairman Jerome Powell has given an "all-clear signal" for gold and silver to move higher with his remarks at Jackson Hole on Friday.

It appears the Fed is now almost certain to resume its rate-cutting campaign in September. In reaction, the Federal Reserve note is moving down sharply in relation to other fiat currencies and precious metals are already buoyant.

Gold is up 1.0% now on the week, with virtually all of that gain coming here today since Powell’s comments hit the wires, and currently checks in at $3,384 an ounce.

Silver is up sharply today and now posts a 2.5% gain for the week, having added close to $1, and trades at $39.15 as of this Friday morning recording.

Platinum is up 1.8% to come in at $1,379 and finally palladium is up 0.6% to check in at $1,147 an ounce.

Inflation is still a problem, but the Fed can't seem to hold the line on rates anymore. This means the negative real return on holding dollars will steepen, and that's rocket fuel for gold.

Gold seems to have so many ways to win in the current economic environment. War, tariff turmoil, debt problems, inflation, and stock market volatility are all reasons to buy gold... and many of these things keep happening at once.

As we've talked about repeatedly on the Money Metals podcast, American investors have been mostly sitting on the sidelines as the dollar price of gold has risen by nearly 80% over the past two years. Things could get interesting if that changes, unless the demand for gold by central banks, Asia, and the Middle East suddenly slows down.

Earlier this week, another big bank, UBS, followed Citi and Bank of America in getting more bullish on gold.

The Swiss investment bank nudged its Q1 2026 forecast gold price by $100 to $3,600 an ounce. This would mean new record highs over the next six months or so.

Gold reached its current record high of $3,500 in April. The yellow metal has since consolidated and has generally traded sideways in the $3,300 to $3,400 range over the last few months.

UBS also raised its Q2 2026 gold forecast by $200 to $3,700 and added a third quarter ’26 target at the same level.

UBS analysts cited several factors influencing their bullish outlook, including U.S. macroeconomic risk, de-dollarization, central bank gold buying, and strong investment demand globally.

UBS analysts anticipate a stagflationary environment with “below trend” economic growth and sticky price inflation. Despite the inflation issue, they too expect the Federal Reserve to cut interest rates soon and they said this combination of factors will lead to lower real interest rates, making gold a more attractive option.

Meanwhile, UBS analysts expect central bank buying to continue to support the gold market.

As for tariffs, analysts at UBS expect rates to settle around 15 percent as more countries enter into trade agreements with the U.S., reducing some of the uncertainty surrounding trade.

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