Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold dipped 0.1% in choppy trade to close just under $1,263 as traders await to tomorrow's non-farm payrolls report.

U.S. stocks rose despite mixed economic data, cutting into safe-haven demand for gold. The Dow added 1.2% and the Global Dow picked up nearly 0.8%, in part because of expectations that yesterday's announcement of additional monetary stimulus in China will boost growth in the world's second largest economy. Rebounding oil prices and upbeat news about mergers and earnings also boosted equities.

Economists lowered estimates for U.S. growth in the fourth quarter to 2% after the trade deficit jumped in December to its highest level in more than two years. The decline in exports and rise in imports are attributed to the stronger dollar, which is making U.S. goods less competitive overseas and imports cheaper. If the Fed elects to cut interest rates this year, the dollar is expected to strengthen further, which would likely exacerbate the trade deficit and cut into GDP.

Productivity fell sharply among non-farm U.S. workers and labor costs rose slightly in December after dropping for three months. New jobless claims rose by 11,000 last week after plunging to a 14-year low the previous week. Tomorrow's non-farm payrolls report will provide a stronger measure of labor market strength.

The other precious metals were mixed. Silver fell 1.1% while platinum and palladium, more directly tied to industry, gained 0.8% and 0.6%, respectively.

At the Comex close: April gold dipped $1.80 to $1,262.70; March silver slid 20 cents to $17.20; April platinum gained $10.70 to $1,249.60; and March palladium added$4.85, to $795.05 an ounce.