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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.


May 27: Gold falls on GDP revision, Yellen

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold fell for an eight session, down 0.5% to close at a three-month low just under $1,214, as the dollar strengthened on improved GDP data. The metal then slid another few bucks to $1,211 in electronic trade after Fed Chair Janet Yellen said an increase in interest rates is probable "in the coming months." While still up 15% this year, the metal is on course for a 6% monthly decline after finishing the week down 3.1%.

The Commerce Department revised Q1 GDP growth upwards to 0.8% from an initial reading of 0.5% on stronger home building and inventories. While still weak, the higher growth number supports the view that the economy is improving enough to support another rate hike. Most estimates project GDP to expand by more than 2% in Q2, based on rising retail sales and a hot housing market.

The dollar gained 0.4% on the growth revision, pressuring gold and other commodities denominated in it for international trade. The buck then extended its gains after Yellen, speaking at Harvard, joined fellow Fed members by signaling the likelihood of an imminent rate hike if the economy and labor market continue to improve.

The other precious metals also finished lower for the day and week. Silver fell 0.5% for a weekly loss of 1.6%. Platinum dropped 1.4% today and 4% this week. Palladium lost 0.9% on the day and 3.8% on the week.

At the Comex close: June gold fell $6.60 to $1,213.80; July silver slid 7 cents to $16.27; July platinum dropped $13.60 to $982.20; and September palladium lost $4.65 to $539 an ounce.




May 26: Gold dips 0.3% on Fed rate view

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold dipped another 0.3% to close at a seven-week low near $1,220 as the prospect of an interest rate hike in coming months continues to weigh on investment demand. The metal has now lost 4% in seven sessions since the release of April's FOMC meeting minutes showing "most" Fed officials in favor of a June increase.

Fed Governor Jerome Powell became the latest U.S. central bankers to signal tighter monetary policy to come, telling the Peterson Institute that another rate increase may be appropriate "if incoming data continue to support" expectations for higher growth and lower unemployment.

Powell warned, however, that rates are likely to remain well below normal for a long time, even after inflation returns to 2%, because of low productivity and lasting damage to the economy done by the recession.

Gold's losses were stemmed by government data showing that U.S. business spending fell for a third straight month in April, causing the dollar to fall for a second day. While orders for durable goods rose because of bookings for commercial jets, core capital goods, considered a proxy for business investment, fell 0.8%. A weaker dollar typically supports gold and other commodities denominated in it for international trade by making them less expensive in other currencies.

The other precious metals finished higher, with silver adding 0.5% while platinum and palladium gained 0.1% and 2.4%, respectively.

At the Comex close: June gold dropped $3.40 to $1,220.40; July silver added 8 cents, to $16.343; July platinum picked up $1, to $995.80; and September palladium gained $12.80 to $543.65 an ounce.




May 25: Gold slides 0.4% on rising risk appetite

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold slid for a sixth session, dropping 0.4% to close under $1,224, as rising oil and upbeat news about Greek debt helped to spur risk appetite, reducing demand for safe-haven assets.

Brent crude jumped 2.3% to close near $50, the highest level since early October, after the Energy information Administration reported U.S. oil supplies fell by 5 million barrels last week. Recent supply disruptions in Canada, Libya, and Nigeria contributed to the unexpectedly large drawdown, helping prices rise around 85% since the mid-February low.

Fueled by gains in energy stocks, Wall Street rallied for a second session, with the Dow adding nearly 1% and the S&P 500 picking up 0.7%. The indexes also received a boost from rising financial and banking shares as speculation grows that the Fed may raise interest rates in June or July. Higher rates tend to boost the bottom line of banks and other lenders.

The IMF and ECB reached a deal to unlock another tranche of aid to Greece, finding that the beleaguered nation has made adequate reforms to its economy. The new funds will prevent Greece from defaulting when big redemptions from earlier bailouts come due in July.

Eurozone stocks and the euro jumped higher on the Greek debt news, aided by reports that Germany's GDP accelerated by more than expected in Q1. The rising euro helped to stall the dollar's recent Fed-inspired rally as the ICE dollar Index fell around 0.2%.

The other precious metals were mixed, with silver adding 0.4% while platinum and palladium lost around 1% each.

At the Comex close: June gold fell $5.40 to $1,223.80; July silver added 8 cents, to $16.33; July platinum dropped $10.40 to $993.80; and September palladium lost $5.65 to $533.15 an ounce.




May 24: Gold hits month low on surging home sales

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold fell 1.7% to close at a one-month low under $1,230 after strong housing data caused the dollar to extend its rally, reducing demand for alternative stores of value.

U.S. new home sales notched their biggest jump in 24 years in April, surging 16.6% to their highest level in eight years, according to data released by the Commerce Department. Numbers for March and February were also revised higher.

The unexpected strength in the crucial housing sector offers further evidence that growth is rebounding in the second quarter after grinding to a virtual halt in Q1. It also gives the Fed more leeway to raise rates in the next few months, coming on the heels of last Wednesday's release of hawkish minutes from the Fed's April meeting

The dollar rallied further against major rivals, with the ICE Dollar Index reaching a two-month high, as traders speculate that higher interest rates are coming soon. The CME FedWatch tool places the odds of a June hike at 34%, up from 30% earlier this week and 20% one week ago. Rising rates strengthen the dollar by attracting forex investment in search of higher yields. A stronger dollar weighs on gold and other commodities by making them more expensive overseas.

The other precious metals also finished lower, with silver dropping 1% while platinum and palladium dropped 0.9% and 2.3%, respectively.

At the Comex close: June gold fell $22.30 to $1,229.20; July silver dropped 17 cents to $16.25; July platinum slid $8.90 to $1,004.20; and September palladium lost $12.55 to $538.80 an ounce.




May 23: Gold slips 0.1% on hawkish Fed

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold dipped another 0.1% to close at $1,251.50, posting its fourth straight down session as the drumbeat builds for higher interest rates from the Federal Reserve in the next few months.

The yellow metal has been under pressure since the minutes from the Fed's April meeting, released last Wednesday, showed "most" of the committee members were in favor of tightening monetary policy at the upcoming meeting in June, if economic reports continue to signal growth.

Last week, several prominent Fed officials reinforced that view in public comments. William Dudley of the New York Fed, John Williams of San Francisco, and Dennis Lockhart of Atlanta all said the economy is on track for higher rates.

Today, James Bullard of the St. Louis Fed added to the chorus, saying that financial instability could result from "keeping rates too low for too long," and that it is "probably good" that the markets prepare for an increase. Several other central bankers are slated to speak this week, capped by Fed Chair Janet Yellen appearing on Friday at Harvard with former chair Ben Bernanke.

Mitigating gold's losses, the dollar edged down slightly after the yen rallied behind Japan's surprisingly strong trade surplus for April. The buck's recent strength has pressured commodities denominated in it for international trade by making them more expensive to overseas buyers.

The other precious metals fell harder than gold, with silver dropping 0.7% while platinum and palladium lost 1% and 1.6%, respectively.

At Comex close: June gold dipped $1.40 to $1,251.50; July silver lost 11 cents to $16.42; July platinum dropped $10.20 to $1,013.10; and June palladium slid $8.65 to $550.25 an ounce.




May 20: Gold sees weekly loss on dollar strength

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold dipped 0.2% to close at a three-week low under $1,253 as this week's hawkish turn in the Fed's view on interest rates continued to boost the dollar and weigh on commodities. The metal finished 1.6% lower for the week.

Wednesday's release of the minutes from the April meeting of the FOMC showed a growing predisposition to raise interest rates within the next few months, with "most" members saying a June hike is on the table, data permitting.

That view was reinforced by statements from several regional Fed officials this week, including William Dudley of the New York Fed, John Williams of San Francisco, and Dennis Lockhart of Atlanta, all of whom said the economy is on track for higher rates. As early as June. The CME FedWatch tool, which tracks Fed fund futures, raised the odds of a June hike from 4% on Monday to 30% after the Fed minutes' release.

The dollar rallied for a third week, boosted by the prospect of rising interest rates to reach its highest level in two months against major rivals. A stronger dollar typically pressures most commodities denominated in it for international trade by making them more expensive overseas.

The other precious metals rebounded today but still finished sharply lower for the week. Silver picked up 0.2% for a weekly loss of 3.5%. Platinum jumped 1% today but still lsot 2.7% this week. Palladium edged up 0.1% but finished the week down 5.7%.

At the Comex close: June gold dipped $1.90 to $1,252.90; July silver added 4 cents, to $16.53; July platinum gained $10 to $1,023.30; June palladium picked up 45 cents to $558.90 an ounce.




May 19: Gold hits 3-week low on rate view

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold fell 1.5% to close at a three-week low under $1,255 as speculation deepens that the Federal Reserve will raise interest rates in June.

Wednesday's release of the minutes from the Fed's April meeting, which showed a majority of committee members inclined to hike in June, sent gold plunging in after-hours trade yesterday to around $1,258 an ounce. Today's action extended the drop by a relatively modest $3, with bargain-hunters stepping in to prevent deeper losses.

Data released today largely support the Fed's view that the economy is gathering speed. Initial jobless claims dropped by the most since February last week, and the Conference Board's index of leading indicators picked up in April.

In addition, another influential Fed official came out in support of tightening soon. William Dudley of the New York Fed said the economy is now "on track to satisfy a lot of the conditions" for a rate hike this summer. The CME FedWatch tool, which tracks Fed fund futures, places the odds of a June hike at 30%, up from nearly zero a month ago.

On the downside, manufacturing in the Philadelphia Fed region dropped deeper into negative territory last month. Following a similar decline in the Empire State survey a few days ago, the data show U.S. factories still struggling amid a strong dollar and soft global demand.

The dollar strengthened further against most rivals in response to the hawkish view on rates, pressuring gold and other commodities denominated in it for international trade by making them more expensive overseas.

The other precious metals finished sharply lower, with silver dropping 3.7% while platinum and palladium lost 2.8% and 3.7%, respectively. Like gold, they saw most of these losses yesterday in electronic trade after hours.

At the Comex close: June gold fell $19.60 to $1,254.80; July silver tumbled 64 cents to $16.49; July platinum slid $29.20 to $1,013.30; and June palladium surrendered $21.15 to $558.45 an ounce.




May 18: Gold extends losses on hawkish Fed

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold dipped 0.2% to close below $1,275, then fell another $17 to $1,258 in electronic trade after the minutes from the Fed's April meeting signaled the growing likelihood of a rate hike in June.

At the FOMC meeting in April, "most" participants voiced support for a June hike if data permits, according to the minutes released today. While some policymakers were still concerned about the slowdown in growth during the first quarter, when GPD grew by 0.2%, the majority said they would be comfortable raising rates in June if growth, employment and inflation remain on track.

The April sentiment reinforces hawkish statements made recently by prominent Fed officials. In the past week, San Francisco Fed President John Williams, Atlanta Fed President Dennis Lockhart, and the New York Fed's William Dudley have warned that June remains a "live" meeting for a rate increase.

The dollar jumped after the Fed minutes, with the ICE Dollar Index adding 0.6% to reach a one-month high, as traders repositioned for the greater likelihood of higher rates. According to the CME FedWatch tool, the odds of June hike jumped to 30%, up from 20% just a few hours before the Fed minutes were published. A rising dollar weighs on gold and other commodities by making them more expensive overseas.

The other precious also closed lower and then extended losses after hours. Silver closed 0.7% lower, then lost another 0.4% after hours; platinum dropped 1.1% and then another 0.8%; and a palladium fell 0.9% and then another 0.6% after the Fed minutes.

At the Comex close: June gold dipped $2.50 to $1,274.40; July silver dropped 12 cents to 17.13; July platinum fell $12 to $1,042.50; and June palladium slid lost $5 to $579.60 an ounce.




May 17: Gold gains on CPI, oil, falling stocks

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained 0.2% to close at a one-week high near $1,277 as a flat dollar, falling equities, rising oil, and higher inflation boosted demand for alternative stores of value

The Consumer Price Index gained 0.4% last month, its biggest rise in three years, driven by sharply higher gas prices and rents. The so-called core CPI, which removes food and energy costs, rose by a modest 0.2%. Real hourly wages, adjusted for inflation, fell 0.1% in April and have gained only 1.3% over the last year.

In other positive reports, factory output expanded by 0.3% in April, offering some hope for the beleaguered sector, and housing starts rose by more than expected as builders increased construction of single-family homes.

Oil jumped another 1% to a new seven-month high on expectation of lower stockpiles. Crude surged more than 3% yesterday after Goldman Sachs released research showing oil surpluses have given way to shortfalls for the first time in two years, in part because of recent production disruptions in Venezuela, Canada, and Nigeria. Gold often trades in sympathy with higher oil as a hedge against energy-inflation.

U.S. equities extended their losses, with the Dow dumping more than 220 points, or 1.25%, on concerns that higher inflation could spur the Fed to raise rates in June. Higher rates tend to weigh on stocks by increasing borrowing costs for companies, eating into growth and profits.

Joint comments by two Fed officials helped to stoke rate concerns as Dennis Lockhart of Atlanta and John Williams of San Francisco said a June hike remains on the table, depending on economic data, with two or three increases likely this year.

After initially rising on the upbeat data, the dollar quickly fell back to flat as traders speculated that the higher CPI will not be enough to prompt a rate hike by the Fed at their next meeting, in June.

The other precious metals were mixed, with silver and platinum adding 0.7% and 0.2%, respectively, while palladium dropped 0.9%.

At the Comex close: June gold gained $2.70 to $1,276.90; July Silver added 11 cents, to $17.27; July platinum picked up $2.40 to $1,055.90; and June palladium slid $5.25 to $585.75 an ounce.




May 16: Gold gains on oil report, weaker dollar

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold gained 0.1% to close above $1,274 after oil surged on reports of a supply deficit and the dollar softened on weak U.S. data, boosting demand for alternative assets. The metal rose as high as $1,290 in intraday trade before succumbing to profit-taking.

Oil prices jumped more than 3% to a six-month high after Goldman Sachs reported that the market has fallen into a supply shortage for the first time in two years. Production disruptions in Venezuela, Canada, and Nigeria have helped drain off overcapacity, according to Goldman analysts, causing the investment bank to raise its target price for oil by 25% this quarter. Gold often trades in sympathy with oil as a hedge against energy-driven inflation.

Manufacturing in the New York Fed region fell last month as the Empire State index of general business conditions plunged deeply into the negative. The strong dollar and weak overseas demand continue to hammer manufacturing and exports, with orders and shipments both contracting.

The dollar weakened against most major rivals following the soft Empire survey as traders speculated that the Fed would be less inclined to raise rates in June. A weaker dollar typically supports gold and other commodities denominated in it for international trade by making them cheaper to foreign buyers.

The other precious metals were mixed, with silver adding o.1% while platinum and palladium slipped 0.1% and 0.2%, respectively.

At the Comex close: June gold gained $1.50 to $1,274.20; July silver added 2 cents, to $17.15; July platinum dipped $1.40 to $1,053.50; and June palladium slid $1.40 to $591 an ounce.




May 13: Gold edges up 0.1% on weak PPI

Source: Bill Musgrave, American Gold Exchange

Austin -- Gold edged up 0.1% to close near $1,273 as weak U.S. wholesale inflation reinforced the Fed's case for caution in raising rates. But its gains were capped by a sharp rise in the dollar following the release of upbeat U.S. retail and consumer data. The metal lost 1.7% for the week, its first weekly drop in nearly a month.

Wholesale inflation remains minimal, with the BLS reporting that the Producer Price Index for April rose just 0.2% for goods and 0.1% for services. Stubbornly low inflation has been a primary concern for the Fed as it considers when to raise rates.

The Commerce Department said retail sales rebounded 1.3% in April, the biggest jump in 13 months, as consumers opened their wallets for cars, clothing, and other goods. In addition, the University of Michigan's index of consumer sentiment jumped to the highest level in ten months.

The solid retailing data suggest that U.S. economic growth is picking up this quarter after virtually stalling during Q1. The Atlanta Fed raised its Q2 forecast for real GDP growth to 2.8%, well above Q1's meager 0.1%.

The dollar extended its rally, with the ICE Dollar Index adding 0.5% today and 0.8% this week, as traders speculate that the Fed may yet be willing to raise interest rate twice this year. A stronger dollar weighs on gold by making it pricier overseas.

The buck's recent rebound may be short-lived, however. Deutsche Bank lowered its dollar forecast, joining Goldman Sachs and Citigroup in projecting a weaker currency this year because of slow global growth and low inflation.

The other precious metals were mixed for the day and lower for the week. Silver picked up 0.2% but still dropped 2.3% this week. Platinum fell 0.6% today and 3% this week, while palladium dropped 0.7% and 2.4%, respectively, on the day and week.

At the Comex close: June gold edged up $1.50 to $1,272.70; July silver added 3 cents, to $17.132; July platinum slipped $1.90 to $1,052.10; and June palladium lost $4.25 to $592.40 an ounce.




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