Is Gold Mispriced? Bullion Hits 7-Month Low as Market Pressures Mount

**Tim Elliott** (0:00)
It's the Morning Drive, this is Mira Business FM, and it is Friday morning, and that can only mean one thing. And I'm looking at the screen, and I see a, I have to say, Jeff Rhodes, very sharp looking this morning.

**Jeff Rhodes** (0:19)
Good morning, how are you Tim?

**Tim Elliott** (0:21)
Very well, we were just commenting on your, what we believe is a new hairstyle there, a new haircut.

**Jeff Rhodes** (0:28)
No, no, no, it means I've just had a shower.
That's what I was told. Guys, it's only 6 o'clock in the morning.

**Tim Elliott** (0:41)
I know. Well, you're in the United Kingdom at the moment, just outside of London, I realize that, and you're there for a while, but no, I appreciate you getting up early, Jeff, to talk to us.
I'm struggling as to where to start, so I thought, well, let's just set this. Here's where we are at the moment. High US inflation fueled by the Iran conflict, of course. Hawkish Fed, expectations of a rate hike. I believe the latest was 68% by September, in terms of what people believe is going to happen. Add in a strong US dollar environment. Gold is in a bearish momentum trade at this point. A seven month low on Wednesday. Lowest since November 2025, 3960
Every time I come in in the morning and I check the gold price, now there's a quick kind of, oh, look at that. Rather than, you know, there's a sharp intake of breath, Jeff.

**Jeff Rhodes** (1:51)
You can't leave yes and no.
It's given the fact that the dollar, I think the dollar is at a two-year high. And we've just had the highest inflation figure for three years, the PCE, 4.1%, I think 1% it was. So, yeah, everything going against gold. So two-year high for the dollar, rampant inflation, 4.1%. Yeah, not good for gold. The implication is an increase in interest rates, as you say, in September. There's some talk about three interest rates this year.
Where was, before the conflict, gold was well above $5,000. And where was oil, Tim? Where was oil? It was around $73.

**Tim Elliott** (2:51)
Exactly. I was going to say $72, but it was around about there.

**Jeff Rhodes** (2:54)
$73, yeah. Today oil is, I'm looking at it, $74.
So that kind of spike in oil prices, the high was well above $100. And the kind of world panicking about oil supplies and the impact overall on inflation, which is fair enough, and you've seen it. You've seen those numbers. But for how long are we going to have those numbers? Because oil is back to where it was before the conflict. And, you know, I'm here in the UK.
The flights into the Middle East are now okay. So it's not a difficult place to go anymore. So there's insurance. So we're back to where we were. But gold is, gold suddenly is around $4,000, not $5,000. I don't think that can last, because we're back to where we were, but gold is lower. I don't get it. I think the price is, I think gold is mispriced. I do, honestly, given the fact that, so next month, we're going to have a lower inflation figure. We are, because oil prices are well off the highs. So I think it's doing okay. I think gold, if it holds around $4,000 for a bit longer, maybe what we're going to see is pivotal trading around that $4,000, maybe $3,800, $4,300. But eventually, as we head into the back half of the year, and suddenly, that 68% rate hike for people calling for is not there anymore.
I'll be first to admit, if there is a rate hike, fair enough. I don't see it. I just don't see it.

**Tim Elliott** (5:00)
Do you think $4,000 is like a psychological milestone right now?

**Jeff Rhodes** (5:05)
Yeah, it is really. Technical and psychological, yeah, I'd say so. And I can't see, as I say, technically, it should hold around this level, and it is. But had a look in this morning, yesterday's low was around $3,980.
Currently, it's been $4,040 this morning. It's doing okay.
But you know, you've spoken to me enough now. I typically tend to be very positive. Anything to do with precious metals, it's difficult for me to be bearish. Just wasn't born that way.

**Tim Elliott** (5:46)
It's not in your water, is it? Do you know what is interesting about this is, you know how we all feel like our phones listen to us and they recommend us things. Can I just run through what my phone told me this morning? So I guess it must be tracking searches, listens to what I talk about. It offered me a few lines on how to understand the sell-off catalysts. So it's sending me gold information, okay?