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Gold has traded between $1,243 and $1,252 so far today…as of 9:30 am Pacific, bullion is up $6 an ounce at $1,249 ahead of a Fed policy statement within the next 90 minutes…Silver is 12 cents higher at $17.25…Copper is off slightly at $2.23…Crude Oil is up 33 cents at $44.37 while the U.S. Dollar Index has retreated one-tenth of a point to 94.38…

The Fed won’t be hiking today, and June (1 week before Britain’s referendum vote on the EU) is probably not an option either…will they then try to increase rates immediately leading into November’s U.S. elections which by themselves could create considerable market volatility in an unpredictable showdown between Hillary Clinton and Donald Trump?…economic data released yesterday showed orders for long-lasting U.S. manufactured goods rebounded far less than expected in March, implying that business spending and economic growth were weak in Q1…another report showed an ebb in consumer confidence in April…the Fed is in a difficult spot and it may not feel comfortable lifting rates until more damage has been done to the U.S. dollar…

There’s no Fed press conference with this meeting and no new economic forecasts to be released…the reaction of the markets will hinge entirely on the policy statement to be issued at 11:00 am Pacific…

Tomorrow, the Bank of Japan is expected to expand stimulus measures…

Ontario “Stimulus” = $300 Billion Debt

If government spending is the answer to economic growth, why hasn’t that strategy worked in so many parts of the world including Canada’s largest province, Ontario?…all that Ontario has to show for years of “stimulus” is a massive debt that one day may crush the province…taxpayers there are dishing out $1 billion a month just to pay the interest on that debt…this is “progressive”?…nationally, we now have a government that seems to have forgotten about the private sector, including the resource sector, and is trying to lead a global campaign to get the world to boost growth via government spending…indeed, Finance Minister Bill Morneau himself is claiming to be at the forefront of the global anti-austerity campaign. “If we can steer people (at the IMF/G20) away from taking austerity measures that might have negative implications for global growth, that’s a really good first step,” Morneau told the Financial Times…most governments across the globe today have all got it wrong as they have created structural deficits while also over-regulating, over-taxing, and engaging in “climate change” fanaticism…this leaves a huge opening for an anti-establishment voice such as Donald Trump who thinks outside the box and can turn the status quo upside down after 8 years of Obama’s efforts to grow the influence of government…

China’s Gold Accumulation Remains Steady

China increased bullion imports from Hong Kong in March as a global price rally stalled and local investment demand showed signs of recovery…net purchases climbed to 64.1 metric tons from 42.9 tons in February and 61.8 tons a year earlier, according to data from the Hong Kong Census and Statistics Department compiled by Bloomberg…a jump in physical deliveries from the Shanghai Gold Exchange and higher imports from Switzerland were signs of steady demand…withdrawals from the bourse climbed to 183 tons in March from 107.6 tons a month earlier, exchange data show…Swiss exports to China climbed to 29.5 tons from 27.2 tons the month before, according to the Federal Customs Administration…

iShares Silver Trust Turns 10 Tomorrow

The iShares Silver Trust (SLV, NYSE), the first Silver exchange-traded product, celebrates its 10th anniversary tomorrow…it’s now the world’s largest Silver-backed investment product with 330 million ounces and net assets of more than $5.5 billion…the ETP was launched on April 28, 2006, a couple of years after the first one in Gold…the Silver Institute notes that the majority of Gold ETP holdings are from institutional investors, whereas Silver ETPs have a higher proportion of retail investors…investment in Silver products was less than 100 million ounces in 2006…at the end of the 1st quarter of this year, Silver held by global ETP’s stood at 640 million ounces…

Oil Update

Oil prices reached a fresh year’s high today with U.S. prices breaking above $45 for the first time since November following data that showed a surprise fall in U.S. Oil inventories…data by the American Petroleum Institute, an industry group, released late yesterday showed that U.S. Crude inventories decreased by 1.1 million barrels last week…the Energy Information Administration will release its official data later today…U.S. production has fallen to below 9 million barrels a day in recent weeks, down from a peak of 9.7 million barrels a day last April, according to the EIA…

CRB Index:  Commodities Are Going Higher

This 2-year weekly chart shows a continuing upward bias in the CRB Index, not surprising given the strength of the Venture which is often a very reliable leading indicator for commodities…note the breakout above the downtrend line and Fib. resistance at 177…the Index is now grappling with its still-declining 200-day moving average (SMA) at 181, but that decline is slowing considerably…we do expect the CRB to overcome this resistance at the 200-day just as Crude Oil, Gold, Silver and the Venture have…RSI(14) and SS have strong up momentum while a bullish +DI/-DI cross has also occurred…DI crosses on longer-term charts such as this are infrequent and often very significant…the last cross was a bearish one in the summer of 2014…

The CRB is headed higher, a call we have strong confidence in given the dynamics of this chart and the behavior of the Venture…

In today’s Morning Musings…

1. Dramatic photos from Colorado Resources‘ (CXO, TSX-V) KSP Property show the effects of glacial retreat, enhancing the possibilities of another major discovery in the Iskut River Gold Camp – Part 3 of our series with Colorado President & CEO Adam Travis…

2. Equitas Resources (EQT, TSX-V) secures a 100% interest in 6 Brazilian Gold properties…

3.  Pan American Silver (PAA, TSX) acquires more Kootenay Silver (KTN, TSX-V) stock…

4. Yet another Lithium play looking strong…

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