Silver Gets Slammed as Buck Gets Boosted

Silver, gold, platinum and copper all took it on the chin after the retail sales report was released by the Census Bureau Thursday. The report indicated retail sales increased sharply when a drop in sales was anticipated due to COVID-19. The rationale for the heavy metal selling was that more robust sales indicate less need for the Federal Reserve to lower interest rates to boost the economy. Lower rates tend to stimulate inflation, so metal traders dumped silver and gold positions they were holding onto in expectation of lower retail sales and lower interest rates. Many speculators are accumulating silver due to its uses in electronics, alternative fuels and battery storage. On Friday afternoon, silver for December delivery traded at $22.37 per ounce, down about $1.25 from last Friday. December gold traded at $1752, October platinum at $929 and December copper $4.24 per pound.

Hurricanes Reach Apex, La Nina on Horizon

The National Oceanic and Atmospheric Administration (NOAA) believes 20 more named storms could still threaten the U.S. mainland, although, statistically, we should have half of this year’s hurricanes behind us already. Nevertheless, some fear what may be yet to come, citing the terrible Hurricane Sandy, which hit our northeastern seaboard on Oct. 29, 2012.

The El Niño vs. La Niña phenomenon was long perceived as unexplainable, but it’s become a much-studied and well-known weather anomaly. The ENSO (El Niño Southern-Oscillation) is considered the most influential natural climate pattern on Earth. NOAA reports the odds of a La Niña emerging this fall — at least a weak one — are about 70-80 percent. One concern facing the Caribbean and the Southeast U.S. is a strengthening La Niña might increase vertical wind shear, trade winds and hurricanes.

Energy Rally Won’t Stall Out

Just as Hurricane Ida slowly left the Gulf area, Hurricane Nicholas drifted across our oil and gas producing regions, soaking facilities that were barely able to restore their usual production. As a result, the gulf coast output remains nearly 33 percent below average, just as demand is picking up due to a slightly improving economy.

October crude oil traded at $71.80 per barrel and October natural gas at $5.20, up roughly 30 cents from last Friday. Lumber for November delivery brought $635 per 1,000 board feet on Friday.