AGE Daily Gold Update

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

4/10/2024: Gold slips on elevated CPI

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold slipped 0.6% to close under $2,330 after stronger-than-expected consumer inflation altered the outlook for rate cuts, boosting the dollar and Treasury yields. It was only the metal's second down session in the past 15. Silver edged up 0.3% to $28.05 an ounce.

The consumer price index rose 0.4% in March, slightly more than forecasts of 0.3%, to post a 12-month increase of 3.5%, the highest level since last September. The core rate, less food and energy costs, also added 0.4%, leaving the annualized increase unchanged at 3.8%.

Combined with last week's nonfarm payrolls report showing accelerated job growth in March, the hot CPI print indicates that the economy is not cooling as quickly as the Fed anticipated.

Fed fund futures traders now see a June rate as unlikely, with a probability of just 23%, down from around 56% yesterday.

Benchmark 10-year Treasury yields surged above 4.55% on the shifting rate view, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Tracking higher with yields, the dollar rallied 1.1% against major rivals, hitting the highest level against the yen since the mid-1990s. A stronger dollar pressures gold and other commodities by making them pricier in other currencies.

Gold remains supported by safe-haven inflows because of geopolitical turmoil and economic uncertainty in other major economies. Fitch Ratings downgraded China's foreign debt rating to negative from stable, citing growth concerns and expanding deficits.

Platinum and palladium fell 0.8% and 2.3%, respectively.

At the New York spot close: gold slipped $13.90 to $2,329.60; silver added 7 cents, to $28.05; platinum slid $7.90 to $968.50; and palladium lost $27.70 to $1,058.40 an ounce.