AGE Daily Gold Update

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

4/4/2024: Gold eases from all-time high

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold eased 0.2% to close under $2,289 after some hawkish Fed jawboning prompted traders to take profits from its 7-session rally to new record highs. The consolidation came despite downticks in the dollar and yields. Silver gained another 0.7% to $27.25 an ounce.

Two prominent Fed officials suggested that the fight against inflation has stalled in recent months, perhaps changing the calculus on when to reduce interest rates. Richmond Fed President Thomas Barkin said today it would “smart for the Fed to take our time.” Minneapolis Fed President Neel Kashkari the Fed might not need to cut interest rates this year if inflation remains sticky.

The comments seemed to push back on Fed Chair Powell’s statement yesterday that recent inflation data is merely a “bump” in the road that will not change the outlook for monetary policy. At its meeting last week, the central bank projected three rate cuts totaling 75 basis points by December.

Chicago Fed President Austan Goolsbee echoed Powell’s view, dismissing fears that the economy is overheating by saying two months of hotter-than-expected data “should not knock us off our path.”

As if on cue, first-time US jobless claims rose to a 9-week high last week, far more than forecast. And yesterday’s ISM report showed growth in the services sector fell to a 3-month low in March. More than two-thirds of Americans are employed in service-related businesses.

The softer data pushed benchmark 10-year Treasury yields down slightly but they remained near 4-month highs. The dollar slipped 0.2% against major rivals.

Fed fund futures traders have lowered their bets on a June rate cut to 56%, down from more than 70% last week. Tomorrow’s release of the government’s nonfarm payrolls report should further clarify the outlook for June.

Platinum and palladium gained 0.7% and 1.9%, respectively.

At the New York spot close: gold dipped $5.60 to $2,288.20; silver rose 19 cents to $27.25; platinum picked up $6.10 to $943.50; and palladium climbed $19.60 to $1,041.30 an ounce.