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Daily Gold Update
Current precious metals news

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


January 29: Gold falls 2.4% on rate speculation

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold fell 2.4% to close at a two-week low under $1,255 as rising Fed optimism and falling jobless claims prompted traders to take profits from the metal's 9% rally this month.

Yesterday's FOMC policy statement was more upbeat than previous editions, containing language upgrading the economy's expansion from "moderate" to "solid," and job growth from "solid" to "strong." But because the Fed also maintained its promise to be "patient" about deciding when to raise interest rates, the market registered little reaction with the metal falling only $3 in response after hours.

This morning, however, sentiment shifted after reports that weekly jobless claims fell to a 15-year low last week. The surprisingly strong data underscored the sense of "strong" job-growth described by the Fed—despite the fact that the tally was for a holiday-shortened week. As a result, traders speculated that the first rate hikes may come mid-2015, after all. Prior to yesterday's statement and today's data, most analysts were looking toward September at the earliest, with some, like Morgan Stanley, saying no hike until the first quarter of 2016.

The dollar jumped against most rivals, weighing on gold and other commodities denominated in it for international trade. Rising interest rates tend to increase demand for the dollar as a store of value. Silver tumbled a whopping 7.3% while platinum and palladium dropped 3.3% and 2.8%, respectively.

At the Comex close: February gold fell $31.30 to $1,254.60; March silver tumbled $1.32 to $16.77; April platinum lost $41.20 to $1,217.30; and March palladium dropped $24.70 to $771.60 an ounce.




January 28: Gold slips as Fed stays optimistic

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold slipped 0.3% to close under $1,288 and then dipped another $3 in electronic trade after the Fed's new policy statement, released this afternoon, left the door open for higher interest rates later this year.

As expected, the Fed's statement repeated recent optimism about improvements in U.S. labor markets, economic growth, and prospects for inflation rising to the 2% target. The central bankers looked past turmoil in currency markets, slowing global growth, softer U.S. data, and deflationary pressure in Europe and Asia. They reiterated their willingness to be "patient," which most analysts took to mean no rate hikes before June.

The dollar edged up before the statement, fluctuated, and then held its gains as traders clung to the absence of any dovish changes in the Fed viewpoint on rates. Gold slid around $3 in electronic trade following the release.

The dollar was also supported by Singapore's unexpected easing, which pushed its dollar to a four-year low in an effort to keep pace with recent monetary easing by the ECB, Denmark, India, and Canada. A stronger dollar weighs on gold and other commodities by making them more expensive to international buyers.

The other precious metals were mixed. Silver tracked lower with gold, dropping 0.4%, while platinum finished virtually flat and palladium picked up 0.8%.

The Comex close: February gold slipped $4 to $1,287.70; March silver dropped 7 cents to $18.01; April platinum inched up 20 cents to $1,264.50; and March palladium gained $6.60 to $787.35 an ounce.




January 27: Gold gains 1% on soft data, falling dollar

Source: Bill Musgrave, American Gold Exchange

Austiin -- Gold gained 1% to close near $1,292 as surprisingly poor U.S. durable goods data weakened the dollar, hammered equities, and increased demand for alternative stores of value.

Falling for the fourth month in the last five, orders for long-lasting manufactured goods declined by whopping 3.4% in December, the biggest drop since August. The broad-based weakness was attributed to slackening demand in Europe and emerging markets. It signals that slower growth for the U.S. economy is likely in the first quarter of 2015.

U.S. equities tumbled on the weak data, with the Dow surrendering nearly 300 points, or 1.7%, while the S&P 500 lost 1.3%. The losses came despite reports that consumer confidence rose by more than expected in January to the highest level since 2007. However, business investment fell in December for the fourth straight month.

The dollar lost 1% against major rivals on speculation that softer data, slowing global growth, and falling inflation will prompt the Fed to postpone raising interest rates until later than expected. A falling dollar supports higher prices for gold and other commodities denominated in it for international trade by making them less expensive to foreign buyers.

Economists at Morgan Stanley today forecast no rate hikes until March 2016, long after the mid-2015 dates mentioned by many analysts. The Fed meets this week to review monetary policy.

Hedge funds are now at their most bullish toward gold in more than two years. Bets on higher prices to come, so-called long positions, jumped by 20% last week while short positions fell. Bullish positions rose by a net 27%, to the biggest total since 2012, when gold was priced over $1700 an ounce. Global turmoil, slower growth, and the explosion of monetary easing by central banks are contributing factors.

The U.S. Mint reports silver bullion sales have risen to a three-month high, with demand being driven by concerns that Europe's economic woes will affect the U.S. The Mint has sold more than 5 million one-ounce silver Eagles so far this month, the most since October and slightly more than Last January. Silver has gained 19% in 2015.

The other precious metals were mostly higher. Silver picked up 0.5% and platinum and gained 0.7% while outlier palladium, most heavily tied to industry, dipped 0.1%.

At the Comex close: February gold gained $12.30 to $1,291.7; March silver picked up 10 cents to $18.08; April platinum rose $9.30 to $1,264.30; March palladium dipped $1.10 to $780.75 an ounce.




January 26: Gold eases following Greek vote

Source: Dana Samuelson, American Gold Exchange

Austin, TX -- Gold traded lower on Monday, closing the New York session just under $1,280, following news that Greek Prime Minister-elect Alexis Tsipras pledged to keep the nation within the single currency area. While Syrzia, the anti-austerity party, handily won the election in Greece on Sunday with 150 seats, they were just shy of a full governing majority in the 300-seat parliament. Rumors of a coalition being formed with the right-wing Independent Greeks eased traders worries of a Greek departure from the euro. With gold up 9% in dollars and 18% in euros since the start of the year, traders took some profits off the table following last week’s ECB QE announcement and Sunday’s Greek vote.

The dollar, which hit a new short-term high at 95.85 on the U.S. dollar index in Sunday night trading, trended lower overnight and into the New York session. Conversely, the euro, which hit an 11-year low against the dollar late Sunday, rallied modestly into Monday.

The rating service S&P cut it’s rating on Russia to BB+, the equivalent of junk, putting it below investment grade for the first time in a decade. The ruble fell 4.5% in international trading following the downgrade. The plunge in oil prices, ongoing economic sanctions and the possibility of further sanctions due to renewed escalation of violence in the Ukraine are all weighing heavily on the Russian economy. Analysts believe the ratings services Fitch and Moody’s won’t be far behind in also downgrading Russian debt to junk status.

At the Comex close: February gold slipped just over 1%, or $13.20 to $1,279.40; March silver fell 33 cents to $17.97; April platinum fell $13.70 to $1,255; March palladium gained $7.75 to $781.85 an ounce.


January 23: Gold slips on buck, gains 1.2% for week

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold slipped 0.6% today, closing under $1,293, as the dollar rallied on ECB stimulus plans and traders took profits from yesterday's close over $1,300, the highest in five-months. The metal gained 1.2% for the week, notching its third straight weekly win.

To forestall deflation and stimulate growth, the ECB will buy 60 billion euros per month in government bonds through September 2016, and for longer if the central bank fails to meet its inflation targets. The program will flood the economy with at least a trillion new euros, coming on top of cheap loans and other monetary stimulus already in place.

In response, the euro plunged to an 11-year low today and the dollar rallied against most rivals, rising 0.8% on the ICE Dollar Index Chart. A stronger dollar tends to weigh on gold and other commodities denominated in it for international trade by making them more expensive to holders of other currencies.

The dollar's rise came despite a spate of largely disappointing U.S. economic data. The Chicago Fed's index of national activity turned negative in December; Markit's flash PMI for manufacturing dropped to a 12-month low in January; and sales of existing homes fell in 2014 for the first year in four, according to the National Association of Realtors. On the bright side, the Conference Board reported its index of leading indicators rose 0.5% in December.

The other precious metals were mixed. Silver slid 0.3% but gained 3.1% for the week. Platinum lost 1% today but gained 0.1% for the week. Palladium gained 0.3% today and 2.8% this week.

At the Comex close: February gold slipped $8.10 to $1,292.60; March silver slid 6 cents to $18.30; April platinum fell $14.80 to $1,270; March palladium gained $2.80 to $775.20 an ounce.




January 22: Gold regains $1,300 on ECB easing

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained 0.5% to close over $1,300 for the first time since August after the European Central Bank announced a massive program of monetary stimulus, boosting demand for alternative stores of value.

The ECB will buy 60 billion euros per month in government bonds, around 20% more than expected, through September 2016, Mario Draghi said today. This Fed-style program of asset purchases, known as quantitative easing, is intended to head off deflation and promote growth by dramatically increasing the monetary base. It will further devalue the beleaguered euro, driving Eurozone investors toward gold to hedge against losses in purchasing power.

Following suite, Denmark announced its second reduction in interest rates this week, seeking to prevent unwanted inflows into the krone from the weakening euro. Canada also cut interest rates this week, and Switzerland decoupled its franc from the euro last week, concerned about the devaluations that follow QE.

Gold has now gained almost 10% so far this year, its best annual start since 1980, as rising falling global growth and volatility in equity and currency markets drives investors toward safe havens.

Russia added to its sovereign gold holdings for the ninth straight month in December, bringing its sovereign reserves to 38.8 million ounces, the fifth most of any country. While Russia has more than tripled its horde in the last decade, gold remains only 11% of its total foreign reserves, far less Germany's 66% or the U.S.'s 72%. Central banks have bought around 500 tonnes in each of the last two years to offset the rising currency risk associated with monetary easing.

The other precious tracked higher with gold. Silver picked up nearly 1% while platinum added nearly 0.7% and palladium and palladium 0.5%.

At the Comex close: February gold gained $7 to $1,300.70; March silver picked up 17 cents to $18.36; April platinum added $8.40 to $1,284.80; and March palladium rose $4.05 to $772.30 an ounce.




January 21: Gold near-flat ahead of ECB

Source: Bill Musgrave, American Gold Exchange

Austin -- Holding most of its gains from seven straight winning sessions, gold slipped 50 cents to close just under $1,294 as traders prepare for tomorrow's policy announcement from the ECB. The metal climbed to a new five-month high of $1,306 before slipping back on profit-taking. it is still up more than 9% so far in 2015.

The ECB is expected to announce a plan to buy 50 billion euros per month in government bonds, beginning in March. According to reports, this Fed-style program of quantitative easing will run for either one year or through the end of 2016.

Tantamount to printing money, the ECB's plan will flood the Eurozone with ether 600 billion or one trillion euros, depending on the duration, in a desperate attempt to reverse falling prices and promote growth. QE is considered supportive of higher gold prices because it will further undermine the value of the euro and drive investors into alternative stores of value.

The other precious metals were mostly lower, with platinum and palladium dropping 0.8% and 1.3%, respectively, while outlier silver gained 1.3%

At the Comex close: February gold slipped 50 cents to $1,293.70; March silver gained 24 centsto $18.19; April platinum dropped $10.20 to $1,276.40; and March palladium lost $10.50 to $768.25 an ounce.




January 20: Gold rallies 1.4% to five-month high

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold surged another 1.4%, closing at a five-month high above $1,294, on follow-through from last week's Swiss bombshell in the currency markets and expectations of deeper global easing. The metal has gained more than 7% over seven straight sessions in New York, its longest rally in eleven months, and is up more than 9% so far this year.

Markets remain jittery after the SNB unpegged the Swiss franc from the euro last week in a stunning move that sent global investors scrambling for safe havens. With volatility rising in stocks and growth slowing in Europe, Japan, and China, traders are betting that the Fed will postpone raising interest rates, perhaps until 2016, which will support higher gold prices by pressuring the dollar.

At its policy meeting this week, the ECB is expected to announce Fed-Style quantitative easing of as much as one trillion euros in a desperate attempt to combat deflation. Tantamount to printing money, QE undermines currencies and builds demands for alternative stores of value.

China's growth fell to a 24-year low in 2014, it was reported today, in a further sign that the world's second-largest economy is need of additional stimulus. The IMF lowered its global growth forecast, calling on central banks and governments to pursue accommodative policies to promote growth. Such policies are bullish for gold in part because they promote long-term inflation and reduce confidence in paper money.

The other precious metals followed gold higher. Silver added another 1.2% while platinum and palladium gained 1.4% and 3.2%, respectively.

At the Comex close: February gold surged $17.30 to $1,294.20; March silver added 1.2%, to $17.96; April platinum gained $17.20 to $1,286.60; and March palladium jumped $24.45 to $778.75 an ounce.




January 19: London gold slips on profit-taking

Source: Bill Musgrave, American Gold Exchange

Austin -- With U.S. markets closed for the Martin Luther King holiday, gold slipped 0.4% to $1,274 in London trade as investors took profits from last week's rise of nearly 5%.

Following the Swiss National Bank's shocking decision on Thursday to dump its currency's peg to the euro, gold reached a four-month high last week on demand for the metal as a haven from rising volatility in currency and equities markets.

Support for higher prices remains high, however, with events pending this week that could have major ramifications for the Eurozone. The ECB is expected to announce Fed-style quantitative easing at the end of its policy meeting on Thursday. Tantamount to printing money, QE will further erode the value of the euro and build demand for alternative stores of value.

On Sunday, Greece will hold a general election that may decide whether it remains in the Eurozone. If the anti-austerity Syriza party gains power, as polls indicate it will, Greece may renege on the terms of its agreement with the ECB, resulting in its likely departure from the common currency. Such a market disruption could drive gold substantially higher.

The other precious metals were mixed on the day. Silver dropped 0.3% to $17.68 while platinum was unchanged at $1,263.25 and palladium gained 0.4% to $754.22.




January 16: Gold surges again to 4.9% weekly gain

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained nearly 1% to close above $1,276, its highest level in more than four months, as investors continued to seek protection from pervasive market volatility following Switzerland's unexpected unpegging from the euro. The metal has surged 4.9% this week for biggest weekly rise since August 2013, and 7.9% so far this year—its best annual start since 1986.

Yesterday, virtually without warning, the Swiss National Bank dumped its three-year policy pegging the value of the Swiss franc to the euro. The abrupt reversal spread shockwaves throughout global currency markets, sending the Swiss franc skyrocketing against the euro and dollar, and rallying gold by $30 an ounce.

Today's extension of the gold rally came despite a rising dollar, which picked up 0.4% against major rivals. Typically, a stronger dollar pressures gold because it is denominated in dollars for international trade, becoming more expensive to users of other currencies. Today, they rose in tandem in flights to safety.

Gold was further supported by reports that U.S. consumer inflation fell in December by the most in six years, reducing pressure on the Fed to raise interest rates later this year.

Traders are increasingly bullish on gold. Open interest in New York gold futures surged yesterday by 5.6%, the most in five years, signaling expectations of higher prices to come. Sharps Pixley CEO Ross Norman today forecast an average price of $1,321 in 2015, with a high of $1,425.

The other metals were mostly higher. Silver jumped 3.8% today and a whopping 8% this week. Platinum added nearly 0.5% for a 3.1% weekly gain. Outlier palladium, which is less of a safe-haven asset, fell back 1.6% today and nearly 5% this week.

At the Comex close: February gold gained $11.30 to $1,276.10; March silver jumped 65 cents to $17.75 April platinum added $5.90, to $1,268.70; and March palladium fell back $12 to $754.30 an ounce.




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