AGE Daily Gold Update

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

1/17/2022: Gold gains in electronic trade

Source: Bill Musgrave, American Gold Exchange

Austin — With US markets closed for the MLK holiday, gold edged up 0.1% to 1,819 in electronic trading as rising inflation and hawkish signals from central banks in Europe and Japan lifted demand for alternative stores of value.

European Central Bank President Christine Lagarde said on Friday that she is ready to do whatever is necessary to bring inflation down to 2%. Inflation surged to 5% in December, the highest on record for the Eurozone.

Similarly, the Bank of Japan signaled last week that is planning an eventual rate hike as it phases out quantitative easing. With inflation finally creeping up, the ultra-dovish BOJ may finally move toward normalizing policy after nine straight years of aggressive monetary easing.

Tightening by other major central banks would take some of the shine off the dollar, which has risen sharply in recent months behind the hawkish turn by the Federal Reserve. As Forex traders shift toward the yen and euro, downward pressure on the buck is likely to buoy gold, which becomes less expensive overseas as the dollar weakens.