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


7/19/2024: Gold tumbles on profit-taking

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold tumbled 2.3% to close under $2,396 as Treasury yields and the dollar rebounded for a second session, prompting traders to take profits. The metal ended the week down 0.8%. Silver dropped 3% to finish at $29.09, notching a weekly loss of 5.8%.

With no significant economic data released today, profit-taking took control of the markets, pushing investors into cash while stocks, bonds and gold sold off after rallying sharply this week.

With last Friday's unexpectedly soft CPI capping three straight months of falling consumer inflation and weaker economic data, a litany of dovish comments followed from Fed officials including Fed Chair Powell, cementing expectations the Fed will begin a series of rate cuts in September.

Fed fund futures traders see a 98% chance of at least a quarter-point cut in September, followed by a series of further cuts in the ensuing months as the Fed tries to engineer a soft landing for the economy while continuing to smother inflation.

Stocks and bonds rallied on the easing prospects while gold rocketed 3.8% higher early in the week, closing at a new all-time above $2,462 on Wednesday. Today's largely unmotivated retractions signaled that the markets got ahead of themselves, with exuberance causing over-bought positions ripe for taking profits despite bullish fundamentals.

All three major equity indexes retreated around 0.8% while Benchmark 10-year Treasury yields, which move inversely to bond prices and therefore bond demand, rebounded above 4.2%. Higher yields pressure gold by increasing the opportunity cost for holding it instead of bonds.

The dollar added 0.2% for the day and week, snapping a two-week losing streak as traders went to cash. A stronger dollar weighs on gold and other commodities by making them pricier in other currencies.

Platinum slid 1.2% today and 3.9% this week. Palladium shed 2.9% for a weekly decline of 7.2%.

At the New York spot close: gold fell %56.30 to $2,395.50; silver slid 91 cents to $29.09; platinum dropped $12.20 to $966.20; and palladium shed $26.90 to $902.30 an ounce.


7/18/2024: Gold hovers near record highs

Source: Bill Musgrave, American Gold Exchange

Austin — After closing at a new all-time high above $2,462 on Tuesday, New York spot gold consolidated its gains for a second session, edging down 0.1% to finish under $2,452. Mixed US data and upticks in Treasury yields and the dollar weighed on the metal as traders try to weigh the extent of imminent easing by the Fed. Silver shed 0.5% to close at $30 an ounce.

The Conference Board reported its index of leading economic indicators fell 0.2% in June for its fourth straight monthly decline, signaling a slowdown in US growth. The LEI has only risen once in the past 30 months, in February.

First-time jobless claims jumped 20,000 to 243,000 last week, close to a one-year high, in part because of Hurricane Beryl's landfall in Texas. But stripping out the effects of Beryl, new claims increased and are trending up, suggesting layoffs are rising.

One the positive side, The Philly Fed factory index surged to 13.9 in July from 1.3 in June, where any reading above zero indicates expansion. It was the sixth straight positive reading.

Fed fund futures traders are beginning to question the extent of the pending easing cycle by the Fed. While the odds of a September rate cut hold at 98%, the likelihood of five or six cuts by next June has diminished slightly as traders consider the potentially inflationary tariffs promised in a second Trump administration.

Benchmark 10-year Treasury yields edged up near 4.2% on the shifting longer-term rate view, pressuring gold by increasing the opportunity cost for holding it instead of bonds for safety.

Tracking higher with yields, the dollar added 0.4% against major rivals, making gold and other commodities pricier in other currencies.

Platinum and palladium dropped 2.2% and 2.6%, respectively.

At the New York spot close: gold dipped $3.80 to close at $2,481.50; silver slid 14 cents to $30; platinum shed 22.20 to $978.40; and palladium retreated $25 to $929.20 an ounce.


7/17/2024: Gold dips on profit-taking

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold dipped 0.3% to close under $2,455 despite downticks in Treasury yields and the dollar as traders took profits from yesterday's all-time high close above $2,462. Silver fell 3.5% to finish at $30.14.

Two more Fed officials signaled that their growing comfort with the idea of cutting interest rates this fall. Fed governor Christopher Waller said the central bank is "getting closer" to lowering interest rates after three straight months of cooling inflation. New York Fed President John Williams echoed that sentiment but added that a rate cut in July in unlikely.

Reinforcing rate-cut expectations, the Fed's Beige Book reported "slight to moderate" activity overall for the US economy, with five of 12 districts registering no increase or a downturn. Firms are expecting slower growth going forward with softening labor conditions.

Fed fund futures project the odds of a September rate cut at 98%, down from nearly 100% yesterday, according to CME FedWatch.

Benchmark 10-year Treasury yields continued to slide on the rate view, supporting gold by decreasing the opportunity cost for holding it instead of bonds for safety.

The dollar dropped 0.5% against major rivals led by the yen, which rallied on speculation that the BOJ is intervening to prop it up.

Platinum and palladium each slid 0.3%.

At the New York spot close; gold dipped $7.60 to $2,454.80; silver shed $1.06 to $30.14; platinum edged down $3.10 to $1,000.60; and palladium retreated $2.60 to $954.20 an ounce.


7/16/2024: Gold surges to new all-time high

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold surged another 1.6% to close at a new all-time high above $2,462, driven by growing expectations that a cooling economy and falling inflation will spur the Fed to multiple rate-cuts this fall. Silver jumped 1.7% to finish at $31.20 an ounce.

After last Friday's weaker-than-expected CPI report showed consumer inflation falling to 3% for the first time in a year, a chorus of Fed officials have voiced their belief that the conditions have been met for reducing interest rates.

Fed Chair Jerome Powell said yesterday that three straight months of falling inflation "add somewhat to confidence" that inflation is falling sustainably. San Francisco Fed Bank President Mary Daly also said "confidence is growing" that inflation is heading toward the 2% goal. Chicago Fed President Austan Goolsbee said the falling CPI "is what the path to 2% looks like.”

Fed fund futures traders are now pricing in a September rate cut of at least 25 basis points with 99.8% certainty, according to CME FedWatch. In addition, the odds of three quarter-point cuts by December have risen to more than 50%, and a total of five or six cuts are now expected by next June.

This is a radical change from just a month ago, when traders were uncertain whether any reduction would be forthcoming this year.

Falling rates support gold by weakening the dollar and lower yields, boosting demand for alternative stores of value. The metal has now climbed nearly 20% this year after adding 13% last year.

Benchmark 10-year Treasury yields retreated further under 4.2% on the dovish rate view, boosting gold by decreasing the opportunity cost for holding it instead of bonds for safety.

Gold is also gathering support from safe-haven inflows after the assassination attempt of Donald Trump last weekend fueled political uncertainty and volatility in the markets.

Platinum picked up less than 0.1% while palladium rose 0.6%.

At the New York spot close: gold surged $39.50 to $2,462.40; silver climbed 52 cents to $31.20; platinum added 80 cents, to $1,00.73; and palladium rose $5.60 to $956.80 an ounce.


7/15/2024: Gold rises on rate view

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold gained 0.4% to close near $2,423 on rate-cut hopes and safe-haven inflows after soft inflation data last week and the failed assassination attempt on Donald Trump over the weekend. Silver slipped 0.7% to finish at $30.67 an ounce.

Speaking at the Economic Club of Washington today, Fed Chair Jerome Powell said three straight months of falling inflation "add somewhat to confidence" that inflation is falling sustainably to the Fed's 2% target. Powell has said repeatedly that the Fed needs this confidence before it starts unwinding interest rates.

The comments came after the most recent consumer price index, released last week, showed inflation falling in June for the first time in four years, pulling the annual rate down to 3%, the lowest in a year.

Fed fund futures traders now see a 94% likelihood of at least a quarter-point cut in September, with a second cut expected by December. Lower rates support gold by lowering the dollar and Treasury yields. A weaker dollar makes gold cheaper overseas while lower yields reduce the opportunity cost for holding it instead of bonds.

Adding to the dovish rate view, New York's Empire State factory gauge contracted for the eight straight month in July.

Gold also received support from flights to quality after a gunman shot at Donald Trump over the weekend, wounding his ear. The assassination attempt has increased his chances of winning the November election, according to betting markets, and is expected to increase volatility in bonds and stocks.

Platinum and palladium slid 0.3% and 2.2%, respectively.

At the New York spot close: gold gained $8.90 to $2,422.90; silver slid 21 cents to $30.67; platinum edged down 2.80 to $1,002.90; and palladium shed $21.10 to $951.20 an ounce.


7/12/2024: Gold consolidates strong week

Source: Bill Musgrave, American Gold Exchange

Austin — Consolidating yesterday's 1.8% surge, New York spot gold inched down $1 to finish at $2,414 as cooling inflation and softer US economic data cemented rate-cut expectations, stoking risk appetite at the expense of safe havens. The metal gained 1.1% for the week, its second straight weekly rise. Silver fell 1.6% for the day and week, closing at $30.89 an ounce.

The producer price index measuring wholesale inflation rose 0.2% in June, slightly more than 0.1% forecast, bringing the 12-month rate up to 2.6%. The core PPI, less volatile food and energy, was flat in June, pulling the 12-month rate down to 3.1% from 3.3% in May.

Following yesterday's CPI data showing consumer inflation falling for the first time in four years, the modest PPI reinforced the view that disinflation is back after a reversal during the first quarter of the year.

All three major US equity indexes jumped 1%, with the Dow and S&P 500 hitting new all-time highs as investors grow increasingly convinced that the Fed will almost certainly begin cutting rates in September, if not before.

Weak consumer sentiment data contributed to the rate-cut narrative. The University of Michigan survey said sentiment fell to an eight-month low in July, the fourth decline in a row and the softest reading since November.

Fed fund futures traders now see a 94% likelihood of at least a quarter-point cut in September, with a second cut expected by December.

Benchmark 10-year Treasury yields retreated slightly, buoying gold by decreasing the opportunity cost for holding it instead of bonds. The dollar dropped another 0.4% against major rivals, supporting gold by making it cheaper overseas.

Platinum slipped 0.1% today for a weekly loss of 3.4%. Palladium fell 2.5% for the session and 6.5% for the week.

At the New York spot close: gold dipped $1 to $2,414; silver slid 51 cents to $30.89; platinum edged down $1.30 to $1,005.70; and palladium retreated $24.70 to $972.30 an ounce.


7/11/2024: Gold rockets past $2,400 on CPI

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold rocketed over $2,400, adding 1.8% to close at $2,415, after weaker-than-expected CPI data bolstered hopes for a September rate cut from the Fed, pressuring Treasury yields and the dollar. Silver rose 2.2% to finish at $31.39 an ounce.

The consumer price index fell 0.1% in June, pulling the 12-month inflation rate down to 3%. It was the first monthly decline in four years and the lowest annual rate since June 2023. The core CPI, less volatile food and energy costs, rose 0.1%, the smallest monthly increase since August 2021.

After the CPI print, San Francisco Fed president Mary Daly said she is finally ready to support rate cuts, given two straight months of falling consumer inflation and the general cooling of the labor market.

Fed fund futures traders now see a likelihood of nearly 90% that the Fed will lower interest rates in September, up from around 73% before the CPI print.

Benchmark 10-year Treasury fell sharply under 4.2% on the shifting rate view, boosting gold by reducing the opportunity cost for holding it instead of bonds.

Tracking lower with yields, the dollar lost 0.5% against major rivals, supporting gold and other commodities by making them less expensive in other currencies.

Platinum and palladium added 0.8% and 0.5%, respectively.

At the New York spot close: gold gained $42.80 to $2,415; silver surged 67 cents to $31.39; platinum picked up $7.60 to $1,007; and palladium rose $5.40 to $997 an ounce.


7/10/2024: Gold climbs again on rate view

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold climbed 0.5% to close above $2,372 as Treasury yields and the dollar ticked lower after Fed Chair Jerome Powell's second day of testimony on monetary policy raised hopes for rate cuts. Silver was virtually flat, edging up one cent to $30.73 an ounce.

Appearing before the House Financial Services Committee, Powell echoed his cautious comments to Senators on Tuesday, acknowledging a cooling labor market and falling inflation while emphasizing the need for more data.

But he also said the Fed would not wait for inflation to return to 2% before cutting rates, and would not be bound by the political calendar, suggesting that the first reduction could come before the election in November.

Tomorrow's release of the June consumer price index could deliver precisely the kind of data Powell seeks. Prices are projected to have risen just 0.1%, bringing the annual rate down to 3.1% from 3.3% in May.

Fed fund futures traders responded to what they heard as dovish hints, keeping the odds of a September rate cut at 76% with a second one likely in December.

Benchmark 10-year Treasury yields edged lower on the rate view, supporting gold by decreasing the opportunity cost for holding it instead of bonds. The dollar dipped 0.1%, making gold and other commodities cheaper in other currencies.

Higher oil prices also helped the metal as WTI crude rose 1.2% to $82.40 a barrel after US data showed declining crude inventories for a second week. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

Platinum and palladium added 0.7% and 0.4%, respectively.

At the New York spot close: gold gained $12.10 to $2,372.20; silver picked up a penny to $30.73; platinum added $7.20, to $999.40; and palladium advanced $5.40 to $991.60 an ounce.


7/9/2024: Gold rises despite yields, dollar

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold rose 0.2% to close above $2,360 despite upticks in Treasury yields and the dollar as bargain-hunters lifted demand ahead of this week's CPI release. Silver added 0.3% to finish at $30.72 an ounce.

Benchmark 10-year Treasury yields edged up for the first time in five sessions after Fed Chair Jerome Powell, testifying before the Senate banking committee, refused to commit to the timing of rate cuts. Tracking with yields, the dollar added 0.1% against major rivals.

Emphasizing that he was not sending "any signals about the timing of any future actions," Powell acknowledged that the US economy is no longer "overheated" and the job market "is fully back in balance" after pandemic-related turmoil. He added that "more data would strengthen the case" for rate cuts.

While rising yields and a stronger dollar typically weigh on gold demand, traders looked ahead to Thursday's release of the June consumer price index. Annualized inflation is expected to fall to 3.1% from 3.3% in May, perhaps giving Powell the confidence he needs to begin loosening monetary policy.

Fed fund futures to see a 76% chance of a rate cut in September, with a second one likely in December.

Platinum and palladium dropped 1.6% and 2.8%, respectively.

At the New York spot close: gold gained $4.90 to $2,360.10; silver added 10 cents, to $30.72; platinum shed $16.50 to $992.20; and palladium retreated $28.50 to $986.20 an ounce.


7/8/2024: Gold falls on profit-taking

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold fell 1.4% but held above $2,355 as risk appetite increased and traders took profits from last week's 2.6% rise to a one-month high above $2,388. Silver slid 2.6% to finish at $30.62 after surging 7.4% last week.

A sharp rally in tech stocks lifted the S&P 500 and Nasdaq to record highs early in the session, curtailing demand for safe havens like gold, as traders digested last Friday's subpar payrolls data. Chipmaker Nvidia and AI-related manufacturers led the rally, spurred by the growing likelihood of rate cuts from the Fed.

The economy added 206,000 jobs in June but lost 110,000 jobs from totals in April and May, lifting the unemployment rate to 4.1%, a 30-month high. Following recent data showing weakening inflation and slowdowns in manufacturing and service-related firms, the soft labor data increases the likelihood that the Fed will have to act soon to prevent a sharp downturn in the economy.

Fed fund futures traders now see a 77% likelihood of a rate cut in September and 64% chance of another cut in December. This Thursdays' release for the CPI for June should add further clarity to the rate view.

The dollar added 0.1% against major rivals, pressuring gold and other commodities by making them pricier on other currencies. Benchmark 10-year Treasury yields. Benchmark 10-year Treasury yields were virtually unchanged.

Platinum and palladium dropped 3% and 2.4%, respectively.

At the New York spot close: gold fell $33.30 to $2,355.20; silver slid 77 cents to $30.62; platinum pulled back $31.60 to $1,008.70; and palladium shed $24.90 to $1,014.70 an ounce.

  

Metal Ask      Change
Gold $2,407.86           Price Change Up Arrow $1.31
Silver $29.15           Price Change Down Arrow $-0.19
Platinum $970.14           Price Change Down Arrow $-3.39
Palladium $947.54           Price Change Up Arrow $5.35
In US Dollars

AGE Gold Commentary

7/17:
Gold poised for new breakout!
Falling inflation, GDP, employment, and retail sales all point to rate cuts from the Fed by September. These conditions have the potential to put gold and silver into overdrive. ... read more