US Consumer credit heats up, and will the RBA cut rates?

Spot pricing for Gold $AU4077

Spot pricing for Silver $AU47.91

Spot pricing for Platinum $AU1480

While US retails sales look extremely strong leading into the Christmas period, the nasty side of consumer spend is already looking grim. Consumer credit has almost doubled in the month, reported from 6B to 10B in as many weeks. This is a worrying sign, especially with another month of Christmas purchasing on the cards for many families. With rates starting to ease, perhaps families are simply exhausted from counting pennies, and needed to splurge with some retail therapy to ease the stress of the past few years. Regardless of the reasoning, the repercussions of using debt to purchase retail products are devastating over the long term, with many simply unable to make repayments on purchases made that have little to no value. 

And next week the RBA will meet and decide on Australia’s positioning on interest rates. With most banks now posturing by reducing their variable loan rates ahead of the meeting, most economists are optimistic we’ll finally see a rate cut. But stranger things have happened, and whichever way the RBA decides to position rates, a 0.25% cut would barely help most mortgage holders leading into Christmas.

Gold and Silver look to be finishing up a bottoming through their graphs. After recent highs, then a pullback during the presidential election, both precious metals are looking optimistic in their charts and RSI moving forward.

Enjoy today’s charts.

Gold daily chart, with 200MDA

Silver daily chart, with 200MDA

US500, with 200MDA

ASX200, with 200MDA