Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dropped 1.2% to close just above $1,465 after surprisingly strong US jobs data rallied stock markets and the dollar, undercutting demand for safe-haven assets. The metal ended the week down 0.5%.

US nonfarm payrolls added a whopping 266,000 jobs in November, sending the unemployment rate down slightly to 3.5%. While 50,000 of the new hires were General Motors strikers returning to work, the total far exceeded forecasts, nonetheless, suggesting underlying resilience in the economy despite struggles in the manufacturing and services sectors.

Wall Street rallied sharply on the data, sending the Dow up 1.2% while the S&P 500 and Nasdaq added 1%. US Treasury yields rose as investors shed the safety of government bonds in favor of risk assets.

Consumer sentiment also perked up in November, according to the University of Michigan gauge. This survey contrasts with the recent data from the Conference Board showing consumer confidence falling for the past four months. While surveys on consumer sentiment focus on attitudes toward buying goods today, consumer confidence readings project out six months to offer a forward-looking metric on expected spending.

The dollar rose 0.3% against major rivals as traders speculated that the Fed, after cutting interest rates three times since last summer, will probably stay on hold for the foreseeable future. Lower rates weaken the dollar by making it less attractive for Forex investors seeking yield.

The other precious metals were mostly lower for the day and week. Silver fell 2.7% for a weekly loss of 3%. Platinum slipped 0.2% for the day and week. Palladium edged up slightly today for a 2% rise this week.

At the Comex close: February gold dropped $18, or 1.2%, to settle at $1,465.10; March silver up 46 cents to $16.60; January platinum lost $1.70 to $898.90; and March palladium added $1.70 to $1,846.10 an ounce.