Record Highs, Fed Chaos, and a $100 Silver Question (week ending 1.16.26)

Monday (1.12.26): Gold and silver blasted to fresh record highs to kick off the week as fear surged across markets. Gold jumped to about $4,627, silver to around $86. What spooked traders? Chaos at the Fed and violence in Iran. The Justice Department served the Federal Reserve with subpoenas tied to Chair Jerome Powell’s testimony, raising fresh concerns about political pressure on U.S. monetary policy and the Fed’s independence at a fragile moment for markets. At the same time, protests in Iran have turned deadly, with human-rights groups estimating more than 500 people killed and several thousand arrested amid the unrest. Translation: confidence down, uncertainty up, and capital rushing into safe havens — a backdrop that has intensified demand across precious metals and helped fuel the current silver short squeeze as traders scramble to cover positions in a rapidly tightening market.

Tuesday (1.13.26): Gold and silver are back in beast mode. Silver surged to a new record near $89, while gold briefly tagged $4,644 before cooling slightly. What’s driving it? Fear + flow. Markets are on edge over escalating unrest in Iran and broader geopolitical tensions, boosting safe-haven demand. Inflation data stayed calm (CPI at 2.7%, core easing), but traders got another jolt when CME said it’s changing how margins are set for precious-metals futures — potentially raising trading costs during volatile swings. Net result: gold holding near highs, silver sprinting, and risk staying firmly in the driver’s seat.

Wednesday (1.14.26): Gold and silver ripped higher Wednesday, both hitting fresh record highs, with silver charging toward the $100 mark. What’s fueling it? Risk is back on the table. Markets are jittery over unrest in China, escalating violence in Iran, and an increasingly aggressive U.S. foreign policy stance after Venezuela and moves involving Greenland. Gold climbed to about $4,627, while silver jumped to roughly $91.70. Economic data added fuel: producer inflation came in hotter than expected and retail sales surged, signaling sticky inflation and strong demand. Translation: more uncertainty + stubborn prices = investors piling into metals.

Thursday (1.15.26): Gold and silver cooled off Thursday after silver briefly hit another record overnight. The vibe shift? Less fear. President Trump said the U.S. is unlikely to strike Iran “for now” and added he doesn’t plan to fire Fed Chair Jerome Powell — easing some geopolitical and policy anxiety. February gold slipped $25 to around $4,610. Silver dipped to about $90.90. Trump also paused new tariffs on critical minerals, choosing negotiations instead. Translation: risk dialed down a notch, metals took a breather — but they’re still parked near all-time highs.

Friday (1.16.26): Gold and silver just had a monster week, hitting fresh record highs—before short-term traders grabbed profits ahead of the three-day U.S. holiday (gold −$9 to $4,614; silver −$1.67 to $90.68). The dollar is also flexing, headed for its third straight weekly gain after strong jobs and factory data cooled hopes for quick Fed rate cuts—something Kansas City Fed chief Jeff Schmid says we shouldn’t rush anyway. Overseas, the U.S. and Taiwan struck a big trade deal: tariffs drop to 15%, and up to $500B in new semiconductor financing and guarantees heads to U.S. projects. And China just told high-frequency traders to slow their roll—literally—kicking their servers out of exchange data centers to erase their speed advantage.

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The Fed may have crushed entry-level jobs more than AI

The big picture
The recent surge in unemployment among young workers appears to be driven more by the Federal Reserve’s aggressive interest-rate hikes than by artificial intelligence, challenging the popular narrative that AI is already hollowing out entry-level jobs.

Driving the news
Economists at Google argue that the deterioration in youth employment began before ChatGPT’s public release and closely tracks the Fed’s sharp monetary tightening in 2022–2023. Their analysis suggests job losses have not been concentrated in roles most vulnerable to AI automation. While AI disruption remains a real long-term risk, the current downturn fits a familiar macroeconomic pattern tied to higher borrowing costs and reduced hiring.

By the numbers
• 5.5%: Unemployment rate for workers aged 20–24 in spring 2023 (54-year low).
• 8.2%: Unemployment rate for workers aged 20–24 in December.
• 5+ percentage points: Size of the Fed’s rate increases from March 2022 to summer 2023.
• 2022–2023: Period of the Fed’s most aggressive tightening cycle in four decades.

Why it matters
If monetary policy — not AI — is the main culprit, today’s job-market pain may be cyclical rather than structural. But it also means young workers are entering the AI era already weakened by years of tightening financial conditions, leaving them more vulnerable to future technological displacement.

What to watch
Watch for whether hiring rebounds if interest rates fall; new data on whether job losses shift toward AI-exposed occupations; and whether companies resume entry-level hiring as financial conditions ease.

The bottom line
The evidence so far suggests the Fed’s rate hikes did more immediate damage to entry-level job prospects than AI has. But young workers may still face a double challenge ahead: recovering from a policy-driven slowdown while bracing for the next wave of technological disruption.

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Gold prices trading near record highs as annual U.S. PPI rises 3.0%

The big picture
Gold prices are hovering near all-time highs above $4,630 an ounce as fresh inflation data show producer prices continuing to rise, reinforcing gold’s appeal as a hedge even as markets still expect Federal Reserve rate cuts.

Driving the news
The U.S. Producer Price Index rose 0.2% in November and 0.1% in October, following a sharp 0.6% increase in September. Over the past 12 months, headline wholesale inflation climbed 3.0%, exceeding economists’ expectations for a 2.7% reading. The data were released with a delay due to the recent 43-day government shutdown. Despite hotter inflation, economists say easing remains likely through 2026, and gold has continued attracting strong buying interest.

By the numbers
• $4,632/oz: Latest spot gold price.
• +1%: Gold’s gain on the day of the report.
• 3.0%: Annual headline PPI increase.
• 3.5%: Annual core PPI increase in November.
• 0.2%: Monthly PPI rise in November.
• 0.1%: Monthly PPI rise in October.
• 0.6%: Monthly PPI rise in September.
• 43 days: Length of the U.S. government shutdown that delayed the data release.
• March: Last time core PPI rose 3.5% year over year.

Why it matters
Persistently rising producer prices suggest inflation pressures are becoming more embedded in the economy, which could complicate the Federal Reserve’s path to rate cuts and strengthen gold’s role as an inflation hedge and store of value.

What to watch
Watch for how future inflation data influence expectations for the pace and size of Fed rate cuts; whether elevated core PPI begins feeding into consumer inflation; and if gold can sustain momentum above record levels as real yields and policy expectations evolve.

The bottom line
Gold’s climb near record highs reflects a market balancing two forces: confidence in eventual Fed easing and growing evidence that inflation remains sticky beneath the surface. As long as producer-price pressures persist, gold’s bullish trend is likely to remain intact.

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TD Securities takes a second hit on silver short, losing $606k

The big picture
TD Securities has exited a short position in silver for the second time since October after prices surged to new record highs, resulting in a $606,000 loss and underscoring the intensity and persistence of the metal’s rally.

Driving the news
TD Securities initiated its latest short trade at $78 an ounce, betting that index rebalancing and improved physical-market liquidity would push prices lower. Instead, silver futures jumped more than 19% in a week, triggering the bank’s stop-loss at $93.15 as prices briefly touched $93.70. Analysts now say the expected index-related selling was absorbed by new speculative buying, leaving the market elevated despite stretched positioning.

By the numbers
• $606,000: Loss on TD Securities’ latest silver short trade.
• $78/oz: Entry price of the short position.
• $93.15/oz: Stop-loss level that closed the trade.
• $93.70/oz: Record high for March silver futures.
• +19%: Silver’s price gain in one week.
• +21%: Silver’s gain so far this year.
• ~$7 billion: Estimated new long inflows offsetting index outflows.
• 2020: Year of TD Securities’ previous silver short loss reference point (second stop-out since October).

Why it matters
The repeated failure of a major bank’s short positions highlights how unusual current silver market dynamics have become, with tight physical supply, speculative demand, and policy uncertainty overpowering traditional valuation and technical signals.

What to watch
Watch for signs of a technical breakdown that could trigger long liquidation; changes in physical silver availability and inventory flows between COMEX and London; the impact of President Trump’s decision not to impose tariffs on silver; and whether overbought conditions finally translate into sustained downside momentum.

The bottom line
TD Securities’ second stop-out reinforces that silver’s rally is being driven less by conventional fundamentals and more by structural tightness, speculative positioning, and policy risk. Until forced selling emerges or supply conditions ease meaningfully, bearish bets remain hazardous—even for professional commodity desks.

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NEXT WEEK’S KEY EVENTS

Economic Calendar: January 19 – January 23, 2026 (ET)

MONDAY, Jan. 19
• None scheduled — Martin Luther King Jr. Day (U.S. markets closed)

TUESDAY, Jan. 20
• None scheduled

WEDNESDAY, Jan. 21
• 10:00 am — Construction Spending (Oct., delayed report)
• 10:00 am — Pending Home Sales (Dec.)

THURSDAY, Jan. 22
• 8:30 am — Initial Jobless Claims (Jan. 17)
• 8:30 am — U.S. GDP, First Revision (Q3)

FRIDAY, Jan. 23
• 8:30 am — PCE Price Index (Nov., delayed report)
• 9:45 am — S&P Global U.S. Services PMI (Flash) (Jan.)
• 9:45 am — S&P Global U.S. Manufacturing PMI (Flash) (Jan.)
• 10:00 am — University of Michigan Consumer Sentiment (Final) (Jan.)

IMPACT ON PRECIOUS METALS MARKETS

Market Liquidity (Mon–Tue, Holiday-Shortened Week)
• U.S. holiday and light early-week calendar → thinner liquidity, exaggerated moves possible.
• Positioning and technical levels may dominate early price action.

U.S. Construction Spending (Wed, 10:00 am ET)
• Strong rebound → infrastructure and growth optimism; mildly bearish for gold/silver.
• Weak reading → slowdown narrative reinforced; mildly bullish for metals.
Low-to-moderate market impact.

Pending Home Sales (Wed, 10:00 am ET)
• Rising contracts → housing demand stabilizing; mildly bearish for metals.
• Falling activity → rate sensitivity and housing stress; mildly bullish for metals.
Forward-looking housing indicator; secondary importance.

Initial Jobless Claims (Thu, 8:30 am ET)
• Rising claims → labor-market cooling narrative; bullish for gold/silver.
• Persistently low claims → supports “higher for longer” rates; bearish for metals.
High-frequency labor signal; trend more important than one print.

U.S. GDP – First Revision (Thu, 8:30 am ET)
• Upward revision → growth resilience, inflation risk; bearish for gold/silver.
• Downward revision → slowdown confirmed; bullish for metals.
Market-moving if revision is large.

U.S. PCE Price Index (Fri, 8:30 am ET)
• Hot core PCE → reinforces restrictive policy stance; bearish for gold/silver.
• Cooling inflation → strengthens easing expectations; bullish for metals.
Fed’s preferred inflation gauge; highest-impact release of the week.

S&P Global Flash PMIs (Fri, 9:45 am ET)
• Expansion + rising prices → growth + inflation mix; bearish for metals.
• Contraction → recession risk signal; bullish for gold/silver.
Early read on January business conditions; moderate volatility.

Consumer Sentiment – Final (Fri, 10:00 am ET)
• Improving confidence → spending resilience; mildly bearish for metals.
• Deterioration → risk aversion rising; mildly bullish for metals.
Sentiment driver; usually secondary to PCE and GDP.