Gold had its first positive month of 2021, rising 3.1% to close around $1,768 while silver jumped 5.4% in April to finish at $25.84. Platinum rose a modest 1.2%, underperforming other PGMs, and palladium soared 12.7% to close at a record high as the global economic recovery continues to increase industrial demand for the metal.
Rising Treasury yields, which hammered gold in March, continued into much of April. Metals spent much of the month stuck in a tug of war match between rising yields and increasing inflation worries. Gold would rise one day on inflation data only to fall the next as yields rose to account for projected inflation. The Fed responded to inflation concerns by stating that a lot of these price increases are temporary due to supply chain disruptions and COVID relief aid and would likely not be indicative of actual long-term inflation. Yields subsequently fell well below their monthly highs helping metals recover to finish April strong.
Equities performed well in April, however, unlike March that saw a shift to value stocks due to rising Treasury yields, growth stocks outperformed value on stabilizing yields and strong earnings. The Dow gained 2.7% in April and the S&P 500 rose 5.2%- its best month since November. The Nasdaq finished up 5.4% as several large tech companies significantly outperformed Q1 earnings projections.
Demand remained strong in April, despite rising prices and high premiums due to on-going shortages that have plagued the physical precious metals market for the past year. As Covid cases continue to decline and supply chain kinks across most industries continue to improve, it is probable that premiums will begin to decrease as availability increases in the coming months.