Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold held steady, dipping less than 0.1% to close at $1,643, as yesterday's surprise rate cut and equally surprising Super Tuesday wins by Joe Biden stoked risk appetite, dulling demand for safe havens.

Biden's unexpectedly strong showing in yesterday's primaries, taking nine of 14 states including Texas, propelled him from afterthought to front-runner for the Democratic nomination. More important to stock investors, it also blocked the momentum of Bernie Sanders, whose policies are widely viewed as anti-business.

Wall Street cheered the shift, with the Dow and S&P 500 jumping more than 4.2% each. The rally was led by healthcare stocks like United Healthcare, which jumped 10%. Sanders's platform of replacing private health insurance with Medicare, now viewed as less likely to occur, was considered especially damaging to this sector.

The Biden bump accelerated as investors warmed to the prospect of global monetary easing to blunt the effects of the coronavirus. The Fed's half-point emergency rate cut yesterday signaled the central bank is ready to do what it takes to keep the expansion. Canada followed with its own half-point reduction, and the IMF said it will release $50 billion in economic aid.

Rebounding from a six-week low, the dollar added 0.2% against major rivals, pressuring gold and other commodities priced in it for global trade.

The fact that gold held almost all yesterday's 3.1% surge signals strong underlying demand for safe havens despite the rush toward risk. Lower interest rates typically support demand for the metal as a hedge against currency risk and loss of purchasing power.

Benchmark 10-year Treasury yields rose slightly but remained near all-time lows on persistent worries about the possibility of a global recession caused by the coronavirus.

The other precious metals were mixed, with silver and platinum rising 0.3% and 0.7%, respectively, while palladium slipped 0.1%.

At the Comex close: April edged down $1.40 to $1,643; May silver added 6 cents, to $17.25; April platinum rose $5.60 to $875.20; and June palladium eased $2.50 to $2,385 an ounce.