Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.2% to close above $1,801 as the dollar and Treasury yields edged lower and investors treaded water ahead of next week's CPI release and Fed meeting. It was the metal's third straight rising session.

The Fed, the Bank of England, and the ECB are all set to raise interest rates next week to combat the strongest inflation in decades. The Fed is widely expected to reduce the size of its hike to 50 basis points after four straight jumps of 75.

But better-than-forecast service sector and job growth in November could prompt the Fed to be more aggressive. Traders will scour the post-meeting statements for hawkish leanings.

The dollar slipped 0.3% against major rivals led by the euro and UK pound, lifting gold and other commodities by making them less expensive overseas.

Bond yields also pulled back again, with the 10-year Treasury hovering near multi-month lows around 3.46% while European sovereign yields rose on rate hike expectations. Falling Treasury yields support gold by reducing the opportunity cost for holding it instead of bonds.

Gold also received help from news that China's central bank has purchased 32 tonnes of gold worth $1.8 billion since late 2019, the last time it reported. Globally, central banks bought 399 tonnes in Q3 of this year, by far the most ever in the three-month period, according to the World Gold Council.

The other precious metals were also higher, with silver rising 1.4% while platinum and palladium picked up 0.3% and 4.1%, respectively.

At the Comex close: February gold gained $3.50 to $1,801.50; March silver rose 32 cents to $23.25; January platinum picked up $3.10 to $1,014.60; and March palladium advanced $76.50 to $1,930.80 an ounce.