Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold slid 0.3% to close under $1,842 as yields and the dollar climbed further after strong US jobs data supported expectations that interest rates will remain high. It was the metal’s seventh consecutive losing session.

The Labor Department reported job openings rebounded in 9.6 million in August from 8.9 million in July, a sign that the labor market remains robust and the economy is still growing despite drastically higher interest rates. While openings have dropped from a record 12 million last year, they remain above pre-pandemic levels.

Benchmark 10-year Treasury yields climbed above 4.8%, a new 16-year high as investors become increasingly convinced that the Fed will keep interest elevated for longer than the market wished to believe. Higher yields weigh on gold by increasing the opportunity cost for holding it instead of bonds.

The dollar climbed with yields, pushing to the highest level in nearly a year on the hawkish rate view. A stronger buck pressures gold and other commodities by making them more expensive in other currencies.

Cleveland Fed President Loretta Mester added to rate anxiety by stating that another increase is probable at the Fed’s next meeting. Atlanta’s Raphael Bostic was less hawkish, saying there’s no hurry to hike again but rates will likely remain elevated for “a long time.”

This Friday’s release of the government’s nonfarm payrolls report should give further clarity to the short-term course of monetary policy.

The other precious metals were also lower, with silver sliding 0.2% while platinum and palladium dropped 0.8% and 1%, respectively.

At the Comex close: December gold fell $5.70 to $1,841.50; December silver slipping 4 cents to $21.38; January platinum shed $7.20 to $879.60; and December palladium plunged $13 to $1,192.90 an ounce.