Economic Red Flags - Bullion Zooms

The global economy threw up a few new red flags overnight, and markets wasted no time reacting. The biggest shock came out of New York, with the Empire State Manufacturing Index falling off a cliff. Last month’s upbeat 18.7% reading has collapsed to –3.9%, a huge swing and a pretty blunt signal that manufacturing confidence isn’t just softening — it’s cracking. When a regional index moves that dramatically, traders usually take it as an early hint of what’s brewing across the broader US industrial landscape. Right now, that picture isn’t looking great.

It’s a similar story in the US labour market. Unemployment has now ticked up to 4.6%, continuing the slow but steady rise we’ve seen through the back half of the year. It doesn’t sound catastrophic on its own, but it’s the trend that matters. When unemployment starts creeping up at the same time as manufacturing weakens, the Fed pays attention — and so do gold and silver buyers. A softening labour market is often one of the earliest signs that the economy is beginning to lose altitude.

All eyes now turn to CPI later this week. Inflation is still the centrepiece of everything the Fed does, so this week’s print is going to help shape expectations heading into the new year. If CPI comes in hotter than expected, the “higher for longer” conversation will be back on the table. If it drops unexpectedly, markets will start whispering about earlier-than-expected rate cuts. At the moment, traders are sitting in the middle, waiting for a signal to latch onto. The uncertainty alone has been enough to inject more volatility into metals.

And the US isn’t the only one under the microscope. This week is absolutely packed with global economic releases — labour data out of Europe, central bank commentary across Asia, manufacturing and services reads from multiple regions, and sentiment data that will help fill in the story of how consumers are actually feeling heading into the final stretch of the year. It’s the kind of week where markets move quickly, react emotionally, and often overcorrect. That usually spells opportunity for metals traders.

Back home, Australia is navigating its own set of challenges. CPI concerns continue to bubble away, and the big banks are starting to signal their expectations early. CBA and NAB now believe the RBA may hike rates as early as February next year — a much more aggressive timeline than most people were talking about even a few months ago. With cost-of-living pressures still weighing heavily on households and inflation proving stubborn in key categories, the tone has definitely shifted from “cuts incoming” to “brace for one more squeeze.”

Precious metals have responded exactly as expected. Gold and silver have both had a strong week, but silver continues to be the standout performer. Silver is now sitting at around $96 AUD and is within striking distance of that psychological $100 mark — a milestone that’s getting traders, stackers, and long-timers pretty fired up. It’s rare to see silver lead this aggressively for this long, especially while global data is wobbling, but that’s exactly what’s happening.

Gold is holding firm too, currently around $6489 AUD at the time of writing. It’s been quietly supported by the run of weaker-than-expected economic data and the rising sense that both inflation and employment are heading into uneasy territory. When sentiment cracks, gold usually catches the first bid — and that’s playing out again now.

For anyone buying or selling through The Gold Price Club, things are shaping up for another busy week. Volatility is picking up, global data is messy, central banks are talking tough again, and silver is inching toward a level we haven’t even been able to talk about seriously until now.

It’s going to be an interesting week to watch the charts.