AGE Daily Gold Update

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

8/16/2023: Gold slips for eighth session

Source: Bill Musgrave, American Gold Exchange

Austin — Gold slipped 0.4% to close near $1,928 as yields and the dollar rose again on upbeat data and held those gains after the minutes from the Fed's last meeting revealed hawkish expectations on interest rates. It was the metal's eighth straight lower session, its longest losing streak in six years.

The minutes from the Fed's July meeting showed the central bankers divided over the future course of policy, but with a majority leaning toward higher interest rates. While "a number" of Fed officials cautioned against "inadvertent overtightening," the majority "see significant upside risks to inflation" that may require "further tightening."

Benchmark 10-year Treasury yields climbed to 4.27% after the release as traders shifted their rate outlook. Rising yields weigh on gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Fed fund futures trading showed the odds of another hike in September rose slightly, from 10% to 11.5%, while the chances of another increase by December rose from 34% to nearly 37%.

The dollar tracked higher with yields, adding 0.2% against major rivals, A stronger buck is another headwind for gold because it makes the metal more expansive in other currencies, undercutting demand overseas.

Yields and the dollar were already heading higher before the minutes after the Fed reported US industrial production jumped 1% in July, doubling most forecasts.

The other precious metals also lost, with silver slipping 0.5% while platinum and palladium dropped 0.1% and 2.1%, respectively.

At the Comex close: December gold fell $6.90 to $1,928.30; September silver slid 12 cents to $22.54; October platinum inched down 90 cents to $891.30; September palladium shed $26.20 to $1,212.40 an ounce.