Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dropped 1.3% to close under $1,905 as pessimism about a stimulus deal boosted the dollar, prompting traders to take profits from the metal's three-day rally to the highest level in more than a month.

Prospects for a pre-election stimulus package took a turn for the worse after President Trump tweeted his disbelief that House Speaker Nancy Pelosi and Senate Minority Leader Chuck Schumer would agree to a deal soon enough.

Gold rallied the previous three sessions to just under $1,930, the highest level since mid-September, on speculation that a deal of around $2 trillion was near at hand. Coming after nearly $4 trillion in earlier relief and unprecedented easing from the Fed, another major tranche of fiscal spending is seen as inflationary, boosting gold's attraction as an inflation hedge.

The dollar rebounded from seven-week lows, adding 0.4% against major rivals. The euro weakened as COVID-19 infections surged to a record high in Europe. A rising dollar pressures gold and other commodities by making them more expensive in other currencies.

Some upbeat US data also weighed on the metal. Existing home sales surged 9.4% in September, marking four straight months of increases as Americans took advantage of historically low mortgage rates. And first-time claims for jobless benefits fell to the lowest level of the pandemic, although they remain extremely high at 787,000.

The other precious metals were also lower, with silver dropping 2.1% while platinum and palladium fell 1.1% and 1.3%, respectively.

At the Comex close: December gold lost $24.90 to $1,904.60; December silver dropped lost 53 cents to $24.71; January platinum slid $9.90 to $884; and December palladium dumped $31.60 to $2,395.90 an ounce.