Some long-awaited news dropped this week. On Wednesday, the Fed announced that it will begin tapering the pace of its asset purchases later this month.
According to CNBC, there will be reductions of $15 billion each month — $10 billion in Treasurys and $5 billion in mortgage-backed securities.
If officials keep that pace, the program would end fully by the middle of 2022.
So, why is the Fed doing this? Well, they gave the nation extra emergency support during the start of the pandemic and now officials need to pull it back. By doing so, they hope to get high inflation under control.
The Fed did also say that it will maintain its target interest rates near zero. And that it will slow the pace or reverse its tapering if the economic outlook changes.
Kitco News reports that the announcement helped gold and silver prices jump. But they’re not the only ones watching…
According to Bloomberg Intelligence, gold is the metal to watch next year. Analysts say that when it comes to the metal industry, the top performers of 2021 will not be the best choice for 2022.
Analyst Mike McGlone said gold will steal the show.
In an interview with Kitco News, he said, “Silver has been a top metal underperformer of 2021, notably for failing to follow copper, which leads us to expect 2022’s metals story may be about gold. If copper and aluminum revert from about decade highs, gold should have a greater potential to rise with bond prices. Copper basically needs to sustain above $10,000 a ton as we see it, or gold is poised to steal the show in 2022.”
In other news, a recent survey by The Associated Press-NORC Center for Public Affairs Research found that 47% of Americans polled are expecting economic conditions to worsen within the next year.
The poll also found that only 35% say our economy is in “good” shape, while 65% say it’s in “poor” shape.
No one can say for certain what lies ahead, so it’s better to be prepared and protect yourself now.
Let us help you protect your future. Give us a call at 855-905-5317 for your free one-on-one consultation.