Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

Austin— Gold fell 0.8% to close under $1,280 as upbeat U.S. economic data boosted the dollar and receding tensions with North Korea reduced demand for safe havens.

Retail sales jumped in July by the most in seven months, driven by discretionary spending and car sales, and building momentum for GDP growth in the third quarter. Manufacturing surged in the New York Fed region to the highest level in three years, and import prices ticked slightly higher behind rising energy costs.

Meanwhile, North Korea backed off its threat to attack Guam, de-escalating tensions in the region and taking some of last week's safe-haven premium out of precious metals. Saber-rattling between Pyongyang and Washington boosted gold to a nine-week above $1,290 high last week as investors sought safety.

The dollar added 0.4% against major rivals as the upbeat data raised the likelihood that the Fed may hike rates one more time this year. CME FedWatch now puts the odds of a December hike at 49%, up from 42% one week ago. Higher rates support the dollar by attracting forex monies seeking higher yield, pressuring gold by making it more expensive to overseas buyers.

The other precious metals also fell, with silver plunging 2.4% while platinum and palladium lost 0.8% and 0.7%, respectively.

At the Comex close: December gold fell $10.70 to $1,279.70; September silver plunged 41 cents to $16.71; October platinum dropped $7.50 to $967.40; and September palladium lost $6.10 to $892.05 an ounce.