AGE Daily Gold Update

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

4/18/2024: Gold gains on Middle East worries

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold gained 0.4% to close above $2,382 on safe-haven inflows driven by rising tensions in the Middle East. The increase in the gold price came despite net-positive US economic data and hawkish Fed statements that lifted yields and the dollar. Silver inched down less than 0.1% to $28.38 an ounce.

The Philly Factory gauge of regional business activity rose in March to the highest level in two years behind sharp increases in both new orders and shipments. It was the third straight positive reading and follows an upbeat manufacturing survey from the New York Fed region earlier this week.

First-time jobless claims were unchanged at 212,000 last week, indicating that the labor market remains robust, and layoffs are minimal.

On the negative side of the ledger, the Conference Boards index of leading economic indicators resumed its fall in March, losing 0.3% after rising for the first time in two years in February. And existing home sales dropped 4.3% in March.

With most US recent data showing remarkable resilience in the US economy, two more prominent Fed officials threw shade on the prospect of imminent rate cuts. John Williams of the New York Fed said he feels "no urgency " to lower interest rates. The Atlanta Fed's Earl Bostic echoed this view, saying he's not in a "mad dash hurry."

Benchmark 10-year Treasury yields jumped back above 4.6% as traders decreased their bets on a September cate cut. Fed fund futures trading now sees a 65% likelihood of a quarter-point reduction in September, down from 71% yesterday.

Tracking higher with yields, the dollar added 0.2% against major rivals.

Rising yields and a stronger dollar usually weigh on gold. Today these headwinds were overcome by flights to safety after Israel said it will retaliate against Iran for its recent, if unsuccessful, missile and drone attack.

The gold price is also being supported by near-record physical buying by central banks, especially China, and reports of some 522 tonnes of gold purchased in Q1 through the Shanghai Gold Exchange, considered a proxy for Chinese domestic demand.

Platinum and palladium picked up 0.1% and 0.7%, respectively.

At the New York spot close: gold gained $10.60 to $2,382.30; silver dipped 2 cents to $28.38; platinum added $1.10, to $946.50; and palladium picked up $7.70 to $1,038.50 an ounce.