Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinNew York spot gold gained 0.6% to close above $3,240 as the dollar retreated on softer-than-expected inflation data, prompting bargain-hunters to enter the market after yesterday's 3.5% correction. Silver climbed 1.5% to finish at $32.87 an ounce.

The consumer price index rose a modest 0.2% in April, less than forecasts, to bring the annualized inflation rate down to 2.3%. Rents and housing drove most of the increase while food fell 13%, mostly because of cheaper eggs.

Economists were quick to warn that the April data was gathered before President Trump's so-called "Liberation Day" tariffs were imposed. While the US and China have recently agreed to suspend their trade war for 90 days, 30% tariffs remain on all goods imported from China, along with elevated tariffs on other nations.

In addition, de minimis tariffs on small shipments from China valued at less than $800 have only been lowered to 54%, which is still quite high. These trade policies are widely expected to drive consumer prices significantly higher in the coming months.

Gold fell sharply yesterday after China and the US agreed to pause most of their exorbitantly high tariffs, fueling risk appetite and undercutting some of the safe-haven demand that drove temporarily bullion above $3,500 in late April.

The dollar fell 0.3% against major rivals, supporting gold and other commodities by making them cheaper overseas.

Platinum and palladium rose 1.9% and 1.3%, respectively.

At the New York spot close: gold gained $20.30 to $3,240.30; silver rose 48 cents to $32.87; platinum picked up $18.90 to $990.90; and palladium added $12.30, to $960.50 an ounce.