Gold's Shine Spreads to Other Precious Metals

Gold's Shine Spreads to Other Precious Metals -Wall Street Journal
"Gold has recovered some of its former shine lately. Silver and platinum have been dull by comparison, but if history is any guide they are likely to regain their luster too. The price of silver, as measured by futures contracts traded on the New York Mercantile Exchange, has surged by 8.3% over the past two weeks. This may be a sign that gold's impressive rally over the past year - its price has gone up 16%, compared with roughly 6% for the S&P 500 - is finally spreading to other precious metals. Part of the yellow metal's jump is explained by extraordinary demand for haven assets. Investors have been fretting about the risk of a global economic slowdown as well as an escalation in the U.S.-China trade spat. But much of it also has to do with the Federal Reserve's policy. And that should eventually boost all precious metals. Gold tends to move in the opposite direction to these bonds' yields, which have plummeted since the beginning of the year. This is because the Fed has led investors to believe that it will soon lower rates - most now expect the first rate cut in a decade to happen later this month. What is more surprising is that the other two top-traded precious metals, silver and platinum, have lagged behind so much behind. Earlier this month, the ratio of gold to silver closed at a 24-year high....In the case of silver in particular, the link to gold appears too strong to be ignored for long."