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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.


August 30: Gold slides 0.8% on dollar, rate view

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold slid 0.8% to close at a two-month of $1,316.50 after strong consumer data and hawkish Fed comments rallied the dollar, diminishing appetite for alternative stores of value.

Consumer confidence rose to nearly a one-year high in August, according to the Conference Board, boosted by growing confidence in the labor market. Short-term expectations for improving business conditions and personal income also rose.

Fed Vice Chair Stanley Fischer said today that economy is "very close to full employment," embellishing recent remarks that that the Fed may raise rates twice this year, perhaps starting as soon as next month. While he did not comment on the specific timing, Fischer reiterated the central bank's mantra rate hikes will depend on incoming data. Friday's release of the nonfarm payrolls report should give further clues.

Two regional Fed presidents are pushing back against Fischer's viewpoint, however. Dennis Lockhart of Atlanta said he "wouldn't take [Fischer's] position" today, while James Bullard of St. Louis said two rate hikes does not fit his view. CME FedWatch places the odds of a hike coming in 2016 at around 42%.

The dollar jumped 0.6% on the confidence data and Fischer comments, pressuring gold and other commodities priced in it for international trade by making them more expensive in other currencies.

The other precious metals fell harder, with silver losing 1% while platinum and palladium dropped 2.3% and 3%, respectively.

At the Comex close: December gold slid $10.60 to $1,316.50; December silver lost nearly 19 cents to $18.67; October platinum fell $24.50 to $1,056.60; and December palladium dropped $21.05 to $678.20 an ounce.




August 29: Precious metals rebound modestly from Friday’s lows

Source: Dana Samuelson, American Gold Exchange

Austin, TX -- Precious metals rebounded modestly from Friday’s closes as markets have started to process the comments made by various Fed officials at last week’s monetary policy symposium in Jackson Hole, WY. Today gold added $1.20, silver $0.12, while platinum and palladium gained $3.40 and $5.50 respectively. The U.S. dollar index, which measures the greenback against a basket of currencies, softened to 95.53 during the New York session after hitting an eight day high of 95.80 early this morning.

The U.S. Commerce Department reported today that consumer spending, which accounts for more than two-thirds of U.S. economic activity, increased in 0.3% in July following a 0.5% increase in June. July is the fourth straight month of gains, and suggests that momentum from the 2nd quarter, when consumer spending grew 4.4% (it’s fastest pace in nearly two years,) remains intact. Rising wages buoyed by a tightening labor market, along with rising stock and home values are helping to get U.S. consumers, who have been more inclined to save than spend these last two-years, to part with some of their hard earned dollars of late.

Inflation remains tame, however, with the personal consumption index (PCE) gaining 0.1% in June and July. In the last 12 months the PCE, the Fed’s preferred measure of inflation, has expanded 1.6% and remains comfortably below the Fed’s 2% target. Odds that the Fed may raise interest rates during their September meeting have now risen to 38% as the U.S. economy continues to slowly improve, despite persistently low inflation.

At the Comex close: December gold rose $1.20 to $1,327.10; December silver gained 12 cents to $18.85; October platinum gained $3.40 to $1,081.00; December palladium gained $5.50 to $693.30 an ounce.


August 26: Gold up $3.00 today, down 1.5% this week

Source: Dana Samuelson, American Gold Exchange

Austin, TX -- Markets seesawed following Fed Chair Janet Yellen’s speech today as traders tried to glean new insight into the Fed’s monetary intentions in the coming months. While offering no timetable for future Fed rate hikes, Yellen said, “In light of the continued solid performance of the labor market and our outlook for economic activity and inflation, I believe the case for an increase in the federal funds rate has strengthened in recent months.”

Overshadowing Yellen’s comments in a CNBC interview, Federal Reserve Vice Chairman Stanley Fischer said two interest-rate hikes by the end of the year were possible, depending on the strength of economic data, “but these are not things we know until we see the data.” After Yellen’s speech but prior to Fischer’s comments, the dollar fell to a daily low and precious metals and stocks rallied sharply to daily highs. Fischer’s comments, however, caused markets to abruptly reverse course, boosting the dollar over a full point from its 94.2 low to a high of 95.58 on the U.S. dollar index. This dollar reversal in turn caused precious metals and stocks to shed their short lived gains.

Gold tested both short-term support (for the December contract) at $1,321 and resistance at $1,345 today, for a $24 swing, as markets reacted first to Fed Chair Yellen’s speech and then to Fed Vice Chair Fischer’s interview. Silver was also volatile, with the December contract trading in a 53 cent range between $18.50 and $19.03 today. When all was said and done, however, precious metals closed the New York session relatively unchanged from yesterday considering how much media and market anticipation has been placed on Yellen’s speech.

Earlier in the day U.S. GDP for the tepid 2nd quarter was revised down from 1.2% to 1.1%. Consumer sentiment was also revised marginally lower for August from 90.4 to 89.8 according to the University of Michigan’s latest report. Clearly though, the news of the day were the comments from various Fed members attending the annual Fed monetary policy symposium.

At the Comex close: December gold rose $3.00 to $1,327.60; December silver gained 12 cents to $18.73; October platinum dropped $5.40 to $1,071.60; December palladium gained 90 cents to $688.30 an ounce.


August 25: Gold edges 0.4% lower, Yellen speech looms

Source: Dana Samuelson, American Gold Exchange

Austin, TX -- Gold edged $5.10 or 0.4% lower today while the dollar traded sideways and oil gained modestly, as traders continued to position themselves in advance of Fed Chair Janet Yellen’s speech tomorrow titled “The Federal Reserve’s Monetary Policy Toolkit.”

The dollar lost 0.15% to the euro, gained 0.09% against the yen, while the U.S. dollar index, which measures the greenback against a basket of currencies, was almost flat with a 0.05% decline. Oil gained $0.54 or 1.2% and stocks were modestly lower with the Dow off 33.07 or 0.18% and the S&P 500 down 2.95 or 0.14%.

U.S. jobless claims dropped by 1,000 to 261,000, their lowest level in five weeks, signaling that the U.S. employment continues to strengthen as fewer workers lost their jobs last week. In another positive sign for the U.S. economy, orders for durable goods jumped 4.4% in July following a revised 4.2% drop in June. While orders for durable goods can be volatile, because they include aircraft, orders for non-defense capital goods excluding aircraft increased 1.6% last month, the largest gain since January. This increase comes on the heels of a 0.5% June increase, the first back to back gains since January 2015, and signals that companies are more willing to boost spending.

These positive U.S. economic news releases boosted the dollar which in turn pressured gold in early New York trading and markets were mostly sideways thereafter.

At the Comex close: December gold fell $5.10 to $1,324.60; December lost 6 cents to $18.63; October platinum dropped $5.20 to $1,077.00; September palladium gained $2.50 to $685.00 an ounce.


August 24: Gold falls 1.2% on Yellen worries

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold fell 1.2% to close at a four-week low under $1,330 as oil plunged, the dollar perked up, and traders cut positions in advance of Fed Chair Janet Yellen's speech on monetary policy on Friday.

The dollar gained marginally, adding around 0.2% against major rivals, as currency traders remained cautious about the direction of U.S. interest rates. A stronger dollar pressures gold by making it more expensive to foreign buyers.

Oil tumbled around 3% for a second day after the EIA reported U.S. stockpiles rose by an unexpected 2.5 million barrels last week, adding to concern about a global supply glut. Gold often trades in tandem with oil as a proxy for energy-related inflation.

But the biggest driver of gold's drop today is growing sentiment that Yellen may signal an inclination to raise interest rates when she speaks on Friday at the annual Jackson Hole meeting of global central bankers. Allies of the Fed Chair on the FOMC have gone out of their way over the past week to signal that a September hike is on the table, citing stronger data and the risks of waiting too long.

While the Fed fund futures market minimizes the likelihood, with the CME FedWatch calculator registering merely 18% chance for September, gold futures traders appear to be taking the possibility more seriously. Consensus still looks to December for the next rate increase, but hawkish remarks from Yellen could change that calculus.

Perhaps tempering any inclination to tighten policy soon, data released today by the CBP World Trade Monitor shows the world economy is still remarkably weak. Global trade fell 0.8% in Q2 and after a flat Q1, hampered by low growth and anemic demand. The IMF, World Bank, and OECD all have recently cut their global growth forecasts in part because of sputtering trade.

The other precious metals fell harder than gold, with silver dropping 2% while platinum and palladium lost 2.6% and 2.5%, respectively.

At the Comex close: December gold fell $16.40 to $1,329.70; December lost 38 cents to $18.69; October platinum dropped $29.10 to $1,082.20; September palladium shed $17.35 to $682.50 an ounce.




August 23: Gold gains 0.2% as dollar retreats

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained 0.2% in choppy trade, recouping all of yesterday's slide to close above $1,346 after the dollar retreated on uncertainty about interest rates.

The dollar surrendered 0.2% against major rivals, ending a two-day rally, as traders grew more skeptical about the likelihood of a U.S. rate hike in September. Recent comments by prominent Fed officials putting a September hike on the table had lifted the buck over the last two sessions, pressuring gold and other commodities price in it for international trade.

But today the market apparently pushed back on the prospect of an imminent hike, with traders doubting that Fed Chair Janet Yellen will shake things up so close to the election. Further guidance is expected when Yellen addresses a conference of global central bankers in Jackson Hole on Friday.

The dollar's loses, and gold gains, were capped by data showing new-home sales surged to an eight-year high in July.

The other precious metals also finished higher, with silver and platinum adding 0.3% while palladium climbed 1.1%.

At the Comex close: December gold gained $2.70 to $1,346.10; September silver added 6 cents, to $18.92; October platinum rose $3.10 to $1,111.30; and September palladium climbed $7.70 to $699.85 an ounce.




August 22: Gold dips 0.2% on rate view

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold dipped 0.2% to close above $1,343 after hawkish comments about interest rates from another Fed official supported the dollar, cutting into demand for alternative assets.

Speaking in Colorado yesterday, Federal Reserve Vice Chairman Stanley Fischer, a close ally of Fed Chair Janet Yellen, said the economy is "close to our targets" of strong employment and 2% inflation, signaling that the Fed may be moving closer to raising interest rates. His comments echoed New York Fed President William Dudley and San Francisco Fed President John Williams, both of whom said last week that the economy is probably ready for tighter monetary policy.

The dollar firmed after Fischer's remarks fueled speculation that a September rate hike may be back on the table. Further guidance is expected from Yellen when she speaks on Friday at the Jackson Hole conference of global central bankers. Rising rates supports the dollar by encouraging foreign exchange investment seeking higher yield. A stronger dollar typically weighs on gold and other commodities priced in it for international trade.

Gold was further pressured after oil fell 3.5% on profit-taking and growing expectations that Iraq and Nigeria will boost production. Gold often trades in tandem with oil as a hedge against energy-related inflation.

The other precious metals fell harder, with silver and palladium dropping 2.4% while platinum lost 0.9%.

At the Comex close: December gold dipped $2.80 to $1,343.40; September silver dropped 46 cents to $18.86; October platinum lost $10.20 to $1,108.20; and September fell $17.20 to $692.15 an ounce.




August 19: Gold slides, dollar rises on Fed confusion

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold slid 0.8% to close above $1,346 after mixed rate messages from the Federal Reserve boosted the dollar and nudged traders into taking profits from recent gains. The metal closed up 0.2% for the week.

New York Fed President William Dudley said yesterday that another rate hike "is edging closer," perhaps putting September's FOMC meeting into play. A close ally of Janet Yellen, Dudley is optimistic that GDP and job growth will improve in the second half of the year although inflation and wage pressure may remain muted.

Separately, John Williams of the San Francisco Fed said he like to see a rate hike "sooner rather than later" because, in his assessment, "the broader economy is in good shape" and waiting too long may incur risks. Atlanta Fed President Dennis Lockhart recently that at least one increase this year is probably warranted because of the improving economy.

These relatively hawkish statements conflict with Wednesday's release of dovish minutes from the July Fed meeting, which showed little urgency to raise rates among Fed officials. They also differ from St. Louis Fed President James Bullard's position, reiterated earlier this week, that the U.S. will be mired in a low-growth, low-inflation phase "for the foreseeable future." Bullard said there is no need to raise key interest rates above 63 basis points, only slightly more than present levels, for a very long time to come.

The dollar recovered 0.4% from an eight week low on the mixed Fed signals, aided by a sharp drop in the UK pound after reports that Britain's official exit from the EU may begin in early 2017, much earlier than expected. A stronger dollar pressures gold and other commodities priced in it for overseas trade.

The other precious metals lower for the session and mixed on the week. Silver fell 2.1% today for a weekly loss of 2%. Platinum fell 1% on the day and 1.3% on the week. Palladium slid 0.6% but finished the week 2.7% higher.

At the Comex close: December gold slipped $11 to $1,346.20; September silver fell 42 cents to $19.32; October platinum dropped $14.80 to $1,118.40; and September palladium slipped $4.05, or 0.6%, to $709.35 an ounce, for a weekly gain of 2.7%.




August 18: Gold gains 0.4% as dollar hits 8-week low

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained 0.4% to close near $1,355 as the dollar weakened further on the heels of yesterday's release of dovish minutes from the July Fed meeting, boosting demand for alternative stores of value.

The FOMC was split in July over the need to raise interest rates, with only two members pushing for an immediate increase while the rest wanted stronger data on hiring, growth, and inflation. Although a September hike remains possible, odds have fallen to merely 12%, according the CME FedWatch calculator, and less than 50% for the rest of 2016.

The dollar dropped 0.6% to an eight-week low against major rivals, pressured by the Fed minutes and a strong rally in the British pound after reports that UK retail sales rose 1.4% in July, easing immediate worries about Brexit damage. A weaker dollar supports gold and other commodities denominated in it for international trade by making them less expensive in foreign markets.

Net-negative data from the Philly Fed also weighed on the buck. While business activity picked up slightly in the mid-Atlantic region, the employment index tumbled to a seven-year low and new orders fell to the lowest level since December.

The other precious metals also finished higher, with silver adding 0.5% while platinum and palladium jumped 1.6% and 3.7%, respectively.

At Comex close: December gold gained $5.90 to $1,354.70; September silver added 11 cents, to $19.76; October platinum climbed $17.50 to $1,132.20; and September palladium jumped $25.85 to $717.55 an ounce.




August 17: Gold falls before, bounces after Fed minutes

Source: Bill Musgrave, American Gold Exchange

Austin -- Receding from a two-week high, gold dropped 0.6% to close the regular session under $1,349 as traders hedged their positions ahead of the release of the Fed's minutes from the July meeting. The metal then rebounded to as high as $1,357 in electronic trade after the minutes showed the majority of officials resistant to raising rates.

The FOMC was relieved that Brexit fallout had not damaged the economy as much as feared, according to July's minutes released today, and were pleased to see the job market regaining momentum after June's swoon.

However, only two members thought an immediate rate hike was in order. The rest argued that more data was needed, leaving the overall tone of the meeting less hawkish than the markets expected.

In a separate presentation today, St. Louis Fed President James Bullard reiterated his belief that one small rate hike is all that can be justified for a very long time to come. Arguing that the U.S. will be mired in a low-growth, low-inflation phase "for the foreseeable future," Bullard sees no need to raise key interest rates above 63 basis points, only slightly more than present levels.

The dollar turned lower after the relatively dovish minutes, supporting gold and other commodities denominated in it for international trade. Yields on Treasury bonds also fell.

The other precious metals also finished lower before recovering somewhat on the Fed minutes. Silver dropped 1.3% at the close before making up roughly half that loss after hours. Platinum dropped 1.2% and then regained roughly 1%, while palladium shed 1.5% before bouncing back around 0.2%.

At the Comex close: December gold dropped $8.10 to $1,348.80; September silver lost 25 cents to $19.63; October platinum fell $12.40 to $1,111.10; and September palladium slid $10.45 to $694.95 an ounce.




August 16: Gold at two-week high on flat CPI

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold had its biggest one-day gain in two weeks, climbing 0.7% to close just under $1,357, a two-week high, after soft inflation data eroded the dollar and boosted demand for alternative assets.

U.S. consumer prices were flat in July, with the Consumer Price Index posting its weakest reading since February. The so-called core CPI, removing volatile food and energy prices, edged up just 0.1%.

The dollar hit fell to a post-Brexit low, dropping 0.8% against major rivals, as traders saw the inflation data as another reason for the Fed to hold off raising interest rates. Low rates pressure the dollar because they are a disincentive to foreign exchange investment in search of higher yield. A weaker dollar supports gold and other commodities by making them less expensive in other currencies.

Gold's gains were capped, and the dollar's losses stemmed, after William Dudley of the New York Fed said a September rate hike is on the table, though dependent on "where the data falls" for inflation and other economic factors. Separately, Dennis Lockhart of the Atlanta Fed said the economy appears strong enough for at least one hike this year.

In a research note to investors, Credit Suisse said gold will average $1,475 in Q4 and rise above $1,500 in early 2017. Its bullish outlook is based on rising investment demand, ongoing economic uncertainty, and negative real interest rates in the world's major economies.

The other precious metals were also higher, with silver adding 0.1% while platinum and palladium rose 0.7% and 1.9%, respectively.

At the Comex close: December gold gained $9.40 to $1,356.90; September silver added 3 cents, to $19.87; October platinum climbed $7.80 to $1,124.10; and September palladium jumped $12.85 to $705.10 an ounce.




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