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


12/1/2023: Gold surges to new all-time high

Source: Bill Musgrave, American Gold Exchange

Austin — Gold futures surged 1.6% to close at a record high above $2,089 as comments by Fed Chair Jerome Powell reinforced expectations that the central bank is likely to cut interest rates in coming months. The metal rose 4.9% for the week on the increasingly dovish outlook.

In prepared remarks at Spellman College, Powell acknowledged that monetary policy has succeeded in slowing the economy as expected, and that the benchmark interest rate is already “well into restrictive territory.” He admitted that "the risks of under- and over-tightening are becoming more balanced,” suggesting that the most aggressive rate-hike cycle in a generation is likely over.

Coming on the heels of dovish comments by a series of regional Fed officials this week, the markets heard Powell’s words as reinforcing the prospect that rate cuts are on the way. Fed fund futures traders now put the odds of a March rate cut at 65%, up from 43% late yesterday.

Recent US economic data has supported the idea of a policy pivot. The Fed’s preferred inflation gauge, the PCE index, dropped to 3% for the past 12 months, the lowest reading since February 2021. Consumer spending weakened in October, rising a modest 0.2% after surging 3.6% during Q3. And the ISM reported manufacturing contracted for the thirteenth straight month.

Benchmark 10-year Treasury yields fell to 4.225% after Powell’s remarks, the lowest level in three months. Falling yields support gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Tracking lower with yields, the dollar slipped 0.3% to end lower for the third straight week. A weaker dollar boosts gold and other commodities by making them cheaper in other currencies, lifting overseas demand.

The other precious metals were mixed for the day and week. Silver added 0.8% today and a whopping 8% this week. Platinum picked up less than 0.1% for a weekly rise of 0.6%. Outlier palladium lost 1% today and 4.4% this week.

At the Comex close: February gold gained $32.50 to $2,089.70; March silver climbed 20 cents to $25.89; January platinum picked up 20 cents to $930.10; and March palladium shed $10 to $1,010.40 an ounce.


11/30/2023: Gold score 3.2% monthly gain

Source: Bill Musgrave, American Gold Exchange

Austin — Gold eased 0.5% to hold above $2,057 as a mild rebound in yields and the dollar prompted traders to take profits from the metal’s five-day rally despite falling inflation and soft data. For the month gold finished 3.2% higher on rising expectations that the Fed is done raising interest rates.

The Fed’s favorite gauge of prices was flat in October, offering yet more evidence that inflation is cooling. For the year, the personal consumption expenditures index dropped to 3%, the lowest reading since February 2021. The core rate, less food and energy, edged up 0.2% for the month but slowed to 3.5% for the year, the lowest since early 2021.

Meanwhile, consumer spending weakened in October, rising a modest 0.2% after surging 3.6% during Q3, as higher interest rates took a bite out of auto sales. Consumer spending accounts for around two-thirds of GDP. And pending home sales dropped to a record-low reading in October.

Benchmark 10-year Treasury yields bounced off recent lows, pushing back above 4.3% after Eurozone inflation fell to 2.4% this month, the lowest level in two years. The drop reflects relative weakness in the region’s economy, making US government bonds more attractive by comparison.

The dollar also perked up, adding 0.8% against major rivals led by the euro. The buck is still on track to lose 3% in November for its worst month in a year. Gold and the dollar typically have a negative correlation because gold is denominated in dollars overseas, making it cheaper when the dollar falls and more expensive when it rises.

The other precious metals were mixed for the day and higher for the month. Silver added 1.1% for a whopping monthly rise of 11.8%. Platinum slipped 0.6% but still added 1% this month. Palladium dropped 2% for the day but jumped 10.4% for the month.

At the Comex close: February gold dropped $.9.90 to $2,057.20; March silver climbed 28 cents to $25.66; January platinum dipped $5.50 to $935.90; and March palladium shed $21.10 to $1,020.40 an ounce.


11/29/2023: Gold rallies to three-year high

Source: Bill Musgrave, American Gold Exchange

Austin — Gold futures rallied another 0.3% to close above $2,067 as an increasingly dovish outlook on interest rates eroded Treasury yields and lifted alternative assets. It was the metal’s fifth day of gains and highest finish in more than three years.

One day after Fed Governor Christopher Waller, an influential hawk, suggested that the Fed “start lowering the policy rate” if inflation continues to fall, more Fed officials have signaled that the most aggressive rate-hike cycle in a generation may well be over.

Cleveland Fed President Loretta Mester said today that current interest rates are “in a good place” and can “respond appropriately to the evolving outlook.” Atlanta Fed President Raphael Bostic said his staff has found that companies were losing pricing power, confirming his view that “inflation keeps falling.”

Richmond Fed President Tom Barkin said he thinks firms will not give up pricing power “until they have to,” so inflation will be more stubborn than he would like.

Still, traders are increasing betting that rate hikes are over and rate cuts are coming. CME FedWatch puts the odds of at least a quarter-point reduction by May at nearly 78%, up from 65% yesterday and 42% a month ago.

Benchmark 10-year Treasury yields continued to erode on the dovish outlook, slipping under 4.3%. Lower yields support higher gold prices by decreasing the opportunity cos for holding it instead of bonds.

Gold’s gains came despite an upward revision in Q3 GDP to 5.2% from an initial 4.9%. But eye-popping number is widely expected to be a one-off driven by unusually large government and household spending. Q4 GDP is projected to fall to between 1% and 2%, according to recent forecasts from the Atlanta Fed.

The other precious metals were mixed, with silver rising 0.6% while platinum and palladium lost 0.9% and 2.5%, respectively.

At the Comex close: February gold added %+$6.90 to $2,067.10; March silver rose 14 cents to $25.44; January platinum slid $8.80 to $941.40; and March palladium shed $27 to $1,041.50 an ounce.


11/28/2023: Gold surges to six-month high

Source: Bill Musgrave, American Gold Exchange

Austin — Gold surged 1.4% to close at $2,040 after dovish comments from a prominent Fed hawk pressured yields and the dollar, lifting alternative stores of value. It was the metal’s fourth winning session and highest finish in six months.

Fed Governor Christopher Waller said today that the central bank is increasingly confident that interest rates are high enough to bring inflation under control. An influential policy hawk, Waller told the American Enterprise Institute that if inflation erodes for a few more months, “we could start lowering the policy rate.”

The Fed fund futures market is now pricing in a 33% chance of a rate cut by March, up from 21% yesterday, and a 65% likelihood by May, up from 53%. By December, traders see a 69% chance of that the Fed will reduce rates by a full 1%, to 4.25%-4.5%.

Deutsche Bank is even more dovish. Projecting a mild US recession in the first half of next year, its economist are forecasting rate cuts of 1.75% in 2024, reducing the benchmark rate below 3.75%.

This week’s release of revised Q3 GDP number and the October PCE Index will help clarify the short-term direction of policy.

Benchmark 10-year Treasury yield fell again after Waller’s dovish pivot, lifting gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Tracking lower with yield, the dollar dumped 0.5% against major rivals on the shifting interest rate outlook. A weaker dollar supports gold and other commodities by making them less expensive in other currencies.

The other precious metals were mostly higher, with silver and platinum climbing 1% and 2.9%, respectively, while palladium slipped 0.3%.

At the Comex close: December gold gained $27.60 to $2,040; December silver rose 25 cents to $24.94; January platinum picked up $27 to $950.20; and December palladium shed $3.10 to $1,057.40 an ounce.


11/27/2023: Gold gains on data, rate view

Source: Bill Musgrave, American Gold Exchange

Austin — Gold gained 0.5% to close above $2,012 after soft US data undercut yields and the dollar by reinforcing the view that the Fed is probably with monetary tightening. It was the metal’s highest finish in three months.

Sales of new homes tumbled 5.6% in October, the government reported. The median price plunged nearly 18% compared to the same month last year while the supply rose 1.4%.

The S&P Global flash index showed the important US services sector grew slightly in November, posting a 50.6 where anything under 50 signals contraction. Most Americans are employed in service jobs. The manufacturing index dropped to 49.4.

Most economists on Wall Street now think a downturn in the US economy is likely in 2024, according to a new Bloomberg survey. A few months ago, fewer than half of the respondents thought so.

Benchmark 10-year Treasury yields fell under 4.4% as traders speculated that the soft data means the current rate-hike cycle is over. The likelihood of a pause in December stands at 97% and in January at 90%, according to CME FedWatch, while the odds of a rate cut in March is 25%.

Lower yields lift gold, a non-yielding asset, by decreasing the opportunity cost for holding it instead of bonds for safety.

Tracking lower with yields, the dollar slipped 0.2% to hover near a three-month low, boosting gold by making it cheaper overseas.

The other precious metals were mixed, with silver climbing 1.5% while platinum fell 1.5% and palladium dropped 1.4%.

At the Comex close: December gold gained $9.40 to $1,012.40; December silver rose 34 cents to $24.68; January platinum fell $13.70 to $923.20; and December palladium shed $14.70 to $1,060.50 an ounce.


11/22/2023: Gold slips as data lifts yields, dollar

Source: Bill Musgrave, American Gold Exchange

Austin — Gold slipped 0.4% to close under $1,993 after net-positive US data lifted yields and the dollar, prompting traders to take profits from yesterday’s 1.1% rally above $2,000 an ounce.

First-time filings for unemployment dropped 24,000 to a five-week low of 209,000 last week, signaling residual strength in the labor market. Ongoing claims also declined for the first time in eight weeks.

Separately, consumer sentiment ticked up toward the end of November, signaling mild optimism about the state of the economy. But Americans continue to fret about inflation, believing it will average 4.5% over next year despite the CPI falling to 3.2% in September.

On the negative side of the ledger, orders for durable goods plunged 5.4% in October, the government reported, falling short of forecasts. So-called core orders, minus defense and transportation, dipped a modest 0.1%.

Benchmark 10-year Treasury yields crept back above 4.4% on the upbeat data, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar recouped some of its recent losses, bouncing 0.4% from a 30-month low. A stronger dollar is a headwind for gold and other other commodities because it makes them more expensive in other currencies, limiting overseas demand.

Lower oil also weighed on the metal as US benchmark WTI crude lost 1.1% after OPEC+ producers unexpectedly delayed a meeting on production cuts. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

The other precious metals were also lower, with silver sliding 0.8% while platinum and palladium lost 1.6% and 3.6%, respectively.

At the Comex close: December gold slipped $8.80 to $1,992.80; December silver shed 18 cents to $23.69; January platinum lost $15.20 to $930.70; and December palladium plunged $38.90 to $1,056.60 an ounce.


11/21/2023: Gold rallies to reclaim $2,000

Source: Bill Musgrave, American Gold Exchange

Austin — Gold rallied 1.1% to close near $2,002 as yields and the dollar slid ahead of the release of the minutes from the Fed’s October meeting. The metal then held those gains despite the minutes showing a slightly more cautious Fed than expected.

Fed officials were cautiously optimistic at their last meeting when they voted unanimously to keep interest rates unchanged. But the minutes from that meeting, released today, also revealed that “most participants continued to see upside risks to inflation,” and want to keep rates high “until inflation is clearly moving down.”

The Fed is forecasting one more hike in coming months, something the markets have utterly discounted. Fed fund futures trading see no chance of rate hikes in December and January, followed by a 30% chance of a rate cut by March, growing to 60% by the May meeting.

Prior to the minutes, benchmark 10-year Treasury yields pulled back under 4.4% on the dovish rate view. Following the release, yields ticked back above 4.4% but remained in the red for the day. Lower yields support gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar fell for a third session ahead of the minutes under pressure from a sharply higher yuan and yen. The buck then inched slightly into the black after the minutes but remained mired near a 30-month low. Dollar weakness boosts gold and other commodities by making them cheaper overseas.

Surprisingly weak housing data also supported the metal. The National Association of Realtors reported US exist-home sales plunged 4.1% in October, marking five straight months of declines to the lowest level in 13 years. Sales were hurt by mortgage rates, which hit a 20-year high in October, and low inventory.

Strong physical buying in other parts of the world continues to undergird the gold price, with gold imports to India jumping to a 31-month high in October.

The other precious metals were also higher, with silver adding 1.1% while platinum picked up 2% and palladium rising 0.3%.

At the Comex close: December gold gained $21.30 to $2,001.60; December silver rose 26 cents to $23.87; January platinum picked up $18.50 to $945.90; and December palladium advanced $3.20 to $1,095.50 an ounce.


11/20/2023: Gold slips on rising risk appetite

Source: Bill Musgrave, American Gold Exchange

Austin — Gold slipped 0.2% to close near $1,980 as hopes for a pivot in monetary policy lifted equities, undercutting safe-haven assets.

All three major US stock indexes extended their recent rallies as traders bet that subdued inflation and softer economic data may induce the Fed to shift from rate hikes to cuts in coming months. The Dow and S&P 500 added 0.8% and 0.9%, respectively, while the rate-sensitive Nasdaq jumped 1.2%.

Following last week’s cooler-than-expected inflation readings, Fed fund futures traders see virtually no chance of rates hikes in either December or January. The odds of a rate cut are now 28% at the March Fed meeting and around 60% at the May meeting.

Today’s risk rally occurred despite more evidence that the US economy is cooling. The Conference Board’s leading economic indicators index fell 0.8% in October for its 19th consecutive monthly decline. The last time the index fell for so long was during the Great Recession, from late 2007 through 2009.

Stemming gold’s slide, benchmark 10-year Treasury yields ticked down slightly to 4.42% and the dollar lost 0.4% against major rivals. Lower yields support gold by decreasing the opportunity cost for holding it instead of bonds. A weak dollar helps gold and other commodities by making them cheaper in other currencies.

The other precious metals were mixed. Silver fell 1% while platinum rose 2.9% and palladium picked up 3.2%.

At the Comex close: December gold dipped $4.40 to $1,980.30; December silver shed 24 cents to $23.61; January platinum rose $25.70 to $927.40; and December palladium climbed $33.40 to $1,092.30 an ounce.


11/17/2023: Gold notches 2.4% weekly win

Source: Bill Musgrave, American Gold Exchange

Austin — Gold edged down around 0.1% to close under $1,984 as traders gleaned some profit from this week’s impressive 2.4% rally, driven by weaker inflation and a shifting rate view of the Fed.

As reported earlier this week, consumer inflation was flat for October for the first time in 15 months, pushing the annualized CPI down to 3.2.%. Wholesale inflation was even milder, with the PPI retreating 0.5% in October for the biggest decline since April 2020.

Against this disinflationary backdrop, retail sales contracted last month for the first time since March, suggesting that consumer spending, the bulwark of the economy, may be finally cooling. And along with it, the labor market, as the economy added just 150,000 jobs last month while first-time claims for unemployment rose to a three-month high last week.

Benchmark 10-year Treasury yields tumbled by the most in a month this week as traders speculated that the Fed is finished with rate hikes and might be looking toward rate cuts in coming months. Falling yields are bullish for gold because they decrease the opportunity cost for holding it instead of bonds.

Fed fund futures traders see virtually no chance of rates hikes in either December or January. The odds of a rate cut are now 28% at the March Fed meeting and more than 60% at the May meeting.

A couple of Fed officials tried to push back somewhat on these dovish expectations today. San Francisco Fed chief Mary Daly and Boston Fed President Susan Collins said more evidence of cooling inflation is needed before “additional tightening” is off the table, let alone loosening.

The dollar fell further, dropping another 0.4% on the shifting rate view to post a weekly decline of 1.7%, the biggest since July. A weaker buck boosts gold and other commodities by making them less expensive in other currencies.

The other precious metals were mostly lower for the day but sharply higher for the week. Silver slipped 0.3% but still scored a 7% weekly win. Platinum edged down 0.1% for the session but rose 6.6% for the week. Palladium picked up 0.9% for a whopping weekly advance of 8.2%.

At the Comex close: December gold dipped 0.2%; December silver slipped 8 cents; January platinum edged down $1.10; and December palladium picked up $9.30 to $1,058.90 and ounce.


11/16/2023: Gold jumps 1.2% on data, yields

Source: Bill Musgrave, American Gold Exchange

Austin — Gold jumped 1.2% to close above $1,983 as soft US data pressured Treasury yields, boosting alternative stores of value.

First-time jobless claims rose to a three-month high of 231,000 last week and ongoing claims rose for the eight straight week to a seven-month high of 1.83 million. Coming after last week’s weaker-then-forecast nonfarm payrolls report, the data points to a decidedly cooler labor market.

Walmart CEO Doud McMillon said today that the giant retailer is expecting a “period of disinflation” in coming months as the economy cools further and consumer demand slows.

The statement comes after consumer inflation was flat for October, dropping the annualized CPI down to 3.2.%. The headline PPI showed wholesale inflation was even milder, retreating 0.5% in October for the biggest decline in wholesale inflation since April 2020.

Benchmark 10-year Treasury yields tumbled below 4.4% as investors sought safety and bet against additional rate hikes from the Fed. Falling yields lift gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven sset.

Fed fund futures traders now see virtually no chance that the Fed will raise rates at its next two meetings. The odds of a rate cut in March have risen to 33% from 25% yesterday.

The other precious metals were also higher, with silver surging 1.7% while platinum edged up less than 0.1% and platinum picked up 0.9%.

At the Comex close: December gold gained $23 to $1,987.30; December silver jumped 40 cents to $23.92; January platinum added 80 cents, to $902.80; and December palladium rose $9.30 to $1,049.60 an ounce.

  

Metal Ask      Change
Gold $2,075.98           Price Change Up Arrow $0.00
Silver $25.59           Price Change Up Arrow $-0.00
Platinum $946.02           Price Change Up Arrow $0.00
Palladium $1,040.00           Price Change Up Arrow $0.00
In US Dollars