AGE Daily Gold Update

AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.

3/27/2024: Gold rises again on yield erosion

Source: Bill Musgrave, American Gold Exchange

Austin — Spot gold rose 0.6% to close at $2,190.60 as Treasury yields eroded further ahead of this Friday’s release of inflation data that may influence the course of interest rate policy from the Fed. The gold price has risen in five of the past six sessions. Silver added 0.5% to close at $24.62 an ounce.

With no major economic data to influence the markets today, benchmark 10-year Treasury yields slipped under 4.2% on speculation that the upcoming PCE release will not be hot enough to change the Fed’s projection of three rate cuts this year. Falling yields lift gold by decreasing the opportunity cost for holding it instead of bonds for safety.

The Fed’s preferred inflation gauge, the personal consumption expenditures index rose at 0.3% in January. Analysts expect the headline number to inch up to 4% in February, while the more important core number, less food and energy, inches down to 0.3% from 0.4% the month before.

The dollar was flat.

Gold remains supported by elevated demand from central banks, especially China’s, which use the metal to diversify risk from G7 currencies. Robust physical demand from Chinese households is also undergirding the gold price. China is the world’s biggest gold consumer.

Platinum and palladium fell 1.5% and 1.2%, respectively.

At the New York spot close: gold rose $13.40 to $2,190.60; silver added 13 cents, to $24.62; platinum lost $13.40 to $899.90; and palladium shed $12.10 to $991 an ounce.