AGE Daily Gold Update

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

1/14/2022: Gold dips into 1.1% weekly win

Source: Bill Musgrave, American Gold Exchange

Austin — Gold dipped 0.3% to close under $1,817 despite weak US data as yields and the dollar rebounded on prospects for tighter US monetary policy, undercutting alternative stores of value. The metal still gained 1.1% on the week on demand for hedges against inflation.

Retail sales fell 1.9% in December, the biggest drop in 10 months, as the resurgent pandemic created shortages of some products and skyrocketing inflation caused shoppers to close pocketbooks. The declines hit every sector but especially internet sales, which fell 8.7%.

Separately, consumer sentiment fell to nearly the lowest level in a decade, according to the University of Michigan survey. Omicron and inflation, again, were the main drivers in consumer pessimism.

Gold initially rallied above $1,829 on safe-haven demand after the weak data but succumbed to profit-taking later in the session.

Benchmark 10-year Treasury yields rose back above 1.78% as traders looked past the soft December reports and focused on the prosect of tighter monetary policy in coming months. Rising yields weigh on gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar rallied 0.4% against major rivals on speculation that the Fed might prove more hawkish than Jerome Powell signaled this week. The buck still lost 0.6% for the week, supporting gold and other commodities by making them pricier overseas.

The Fed Chair told a Senate committee that the central bank would carefully engineer a soft landing for the economy, leading Forex traders to think an overly aggressive policy shift might have been priced into the market.

The other precious metals were also lower for the day but higher for the week. Silver lost 1.1% today but gained 2.3% this week. Platinum dropped 0.8% for a weekly rise of 0.8%. Palladium was down 0.6% for the session but rose 2% for the week.

At the Comex close: February gold dipped $4.90 to $1,816.50; March silver lost 24 cents to $22.92; April platinum slid $7.60 to $964.60; and March palladium dropped $11.80 to $1,878.20 an ounce.