November 26, 2018 -- Gold and silver entered this week essentially unchanged from a week ago. The U.S. dollar continued its rally, which helped explain the lackluster performance.

Metals, gold in particular, are getting some safe-haven buying from investors fleeing the falling stock markets, but the dollar is outperforming for the moment.

The S&P 500 lost more than 3% last week and has now dropped just over 10% from that index’s early October highs. Hints that the Federal Reserve may conclude its cycle of rate hikes in the first half of next year were not enough to stop the bleeding in stocks.

Economists raised the odds of the U.S. economy sliding into recession and, by extension, increased the chances of the FOMC putting a halt to tightening. The experts surveyed indicated the chance of recession in the next two years moved from 30% to 35%.

Fed watchers still expect a rate hike in December followed by an additional 3 hikes in 2019. It remains to be seen whether the equity markets will be able to regain their footing in the face of that much additional tightening. We certainly have our doubts.



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