Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— With markets reopened after President's Day closure, gold held near $1,208 on rising risk appetite and profit-taking from last week's 7.1% surge. Today's finish was 2.5% lower than last Friday's. However, virtually all of the losses came yesterday in electronic trading and did not register on Comex until today.

U.S. and global stocks rallied on hopes of deeper easing in Europe and Japan, with the Dow picking up around 1.3%, the S&P 500 1.5%, and the Global Dow nearly 1%. Mario Draghi said yesterday that the ECB is likely to revisit quantitative easing in March in order to stimulate growth, increase inflation, and stabilize Eurozone banks. Similarly, after Japan's GDP fell again in Q4, investors expect deeper easing from the BOJ.

Helping to fuel domestic stocks, another round of soft U.S. economic data added to speculation that the Fed may shy away from raising interest rates again until late this year. The Empire State manufacturing index remained deeply in negative territory in February, notching seven straight months of contraction. And home-builder sentiment fell this month, reflecting recent worries about growth.

The dollar fell against the yen as oil prices fell despite an agreement by several produces to limit production. Weak oil has supported the yen and euro against the dollar recently as traders have unwound long-positions on assets in oil-rich emerging markets that had been originally been purchased in those currencies.

Against other major rivals the dollar picked up some ground, with the Dollar Index adding 0.2%. A rising dollar pressures gold and other commodities by making them more expensive overseas.

The other precious metals also finished lower, with silver dropping 2.9% while platinum and palladium fell 2.2% and 3.3%, respectively.

At the Comex close: April gold fell $31.20 to $1,208.20; March silver lost 46 cents to $15.33; April platinum dropped $20.80 to $937.30; March palladium was down $17.40 to $509.60 an ounce.