Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold dipped 0.2%, closing just above $1,092, as the dollar rebounded and risk-appetite crept back into U.S. equity markets, reducing demand for alternative assets. The metal had risen above $1,108 earlier in the session as turmoil in global equities boosted safe-haven demand. It remains up 3.4% so far this year.

The dollar picked up 0.5% against major rivals, largely on follow-through from Friday's robust U.S. nonfarm payrolls report. Employers added 292,000 jobs last month and November totals were revised higher by 50,000, leading traders to speculate that improving health in the labor markets will incline the Fed to raise interest rates again this spring.

The CME FedWatch tool now places the odds of a March hike at 47%, April at 53%. A stronger dollar weighs on gold and other commodities by making them more expensive overseas.

U.S. equities fluctuated today, with the Dow losing 200 points before rebounding to gains of around 0.3%, after China aggressively intervened to support the yuan, helping to assuage concerns that China had lost control of its flagging economy.

Stocks were also hit by oil's plunge under $32 per barrel for the first time in twelve years, pulled lower by China's slowdown and the prospect of Iran's production coming to market as sanctions are lifted following its agreement to suspend the enrichment of uranium for weapons.

The other precious metals also finished lower, with silver dropping 0.4% while platinum and palladium, more heavily tied to industry, fell 3.7% and 3.4%, respectively.

At the Comex close: February gold dipped $1.70 to $1,096.20; March silver fell lost 5 cents to $13.87; April platinum dropped $32.40 to $846.30; and March palladium surrendered $19.30 to $474.30 an ounce.