The Zhitong Finance App learned that CITIC Construction Investment Futures released a research report saying that in the short term, the cross-asset substitution effect is more of a one-time impact. However, monetary conditions are still tight, oil prices are generally high, overseas equity markets have yet to stabilize, and the short-term support for silver, platinum, and palladium commodity attributes is not strong, making it difficult to completely resolve the shortfall in precious metals, and the strength of the rebound is expected to be limited in the short term. However, from a long-term perspective, gold is the anchor point of the precious metals sector, and its long-term bullish logic has not wavered. There may be ups and downs in the short to medium term, but it still has the ability to lead the overall upward trend of the precious metals sector.
Recently, precious metals as a whole have shown a weak situation. Gold, silver, platinum and palladium have all fallen below their low points during the year. The mood was pessimistic, and there have also been more “opposing opinions” on the “long-term bull market” logic of precious metals in the market. At the same time as precious metals are weakening, their market performance also deviates from the traditional explanatory framework: US dollar and US bond yields and precious metals, which are important influencing factors for precious metals, are changing in the same direction; the precious metals sector, which was originally known for its safe-haven properties, has recently shared the same trend as the global technology sector, and “risk-based” characteristics have become more prominent; and the traditional chain of “rising oil prices - concerns about inflation - suppressing precious metals” has also loosened.
As far as the new logic of the “gold-US debt” substitution effect is concerned, under the traditional analytical framework, there is a significant substitution effect between US bonds and the US dollar as representatives of the credit money system and precious metals. However, the recent trend in the same direction between precious metals and USD/US bond yields is more due to financial behavior, and the cross-asset substitution effect is expressed in a new form.
As far as the “risk capitalization” of precious metals is concerned, gold weakens its safe-haven properties for a short time due to financial factors, but in the case of silver, it is more driven by marginal changes in narrative and capital structure, rather than solely motivated by asset portfolio balance and liquidity supplementation.
As far as the “crude oil-inflation-precious metals” linkage relationship failed for a short time, it was more due to Walsh's neutral statement that the Fed's interest rate hike expectations were overadjusted, so the rise in crude oil prices was not immediately transmitted to the level of interest rate hikes expected, but in the medium term, the transmission of oil prices to inflation is still an important variable affecting precious metals.