Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinNew York spot gold rebounded for a second session, adding 0.7% to close near $2,640, as Treasury yields and the dollar retreated on concerns about Trump tariffs amidst a raft of generally upbeat US data. Bullion had fallen 3.4% on Monday after Israel agreed to a ceasefire with Hezbollah, draining some of its safe-haven premium. Silver slid 0.9% to finish at $30.11 an ounce.

The Fed’s preferred inflation gauge, the PCE index, rose 0.2% in October, lifting the 12-month inflation rate to 2.3% from 2.2% in September. The core rate, less food and energy, rose 0.3% for the month, nudging the 12-month rate to 2.8% from 2.7%.

The increase, in line with forecasts, is widely considered a blip that will not deter the Fed from cutting interest rates by a quarter-point in December. The odds of a cut held fast at 67%, according to CME FedWatch.

The US economy grew 2.8% in Q3, according to revised figures released by the government, with consumer spending leading the way by expanding 3.5%. Initial jobless claims dipped to a 7-month low last week, but the number of ongoing claimants rose to the highest level since 2018, meaning new jobs are scarce. And US manufacturing remains in a slump, with orders for durable goods increasing 0.2% last month, less than half of most forecasts.

Benchmark 10-year Treasury yields retreated to the lowest level in a month as investors, facing the uncertain consequences of President-elect Trump’s aggressive tariff plans, shifted into the perceived safe of government bonds. Falling yields support gold by decreasing the opportunity cost for holding it for safety.

Earlier this week, Trump said he plans to levy 25% tariffs on Mexico and Canada “on day one,” along with 10% on China. Goldman Sachs economists estimate the tariffs would increase PCE inflation by nearly 1%.

Tracking lower with yield, the dollar dropped 0.9% against major rivals, boosting bullion by making it cheaper in other currencies, boosting overseas demand.

Platinum added 0.4% while palladium lost 0.7%.

At the New York spot close: gold gained $19.60 to $2,639.90; silver slipped 28 cents to $30.11; platinum picked up $3.60 to $926.90; and palladium dipped $6.70 to $982.80 an ounce.