Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold edged up 0.1% to close at an 11-week high above $1,234 as heightened volatility in stocks, oil, and currency markets spurred demand for safe-haven assets.

The S&P 500 swung wildly again today, erasing early gains to fall 0.6% into the red before recouping most of its losses, while crude oil plunged to a six-year low near $44 a barrel before rebounding above $46 late in the session. So far this year, the S&P has averaged more than a 1% move each session, twice as much as the 2014 average, raising red flags among investors.

The euro eroded to a new nine-year low against the dollar on expectations that the ECB will embark on Fed-style quantitative easing later this month to combat deflation and slowing growth. Tantamount to printing money, QE devalues currencies and boosts demand for alternative stores of value like precious metals.

Worries about Greece also dog the euro. Prime Minister Samara continues to trail his anti-austerity opponent in the polls, raising concerns that the government may shift to the Syriza party. If that happens, Greece may renege on its bailout obligations and leave the euro, the Greek Finance Minister said today, potentially jeopardizing the viability of the currency itself.

Market volatility in 2015 has traders looking for cover in bonds and gold. Yields on 10-year U.S. Treasurys fell for the tenth time in the last eleven sessions as safe-haven demand bid up prices. Gold has rallied almost 4% so far this year, handily erasing last year's 1.4% loss, while the Dow has fallen around 1.5% and crude oil has plunged around 13%.

The other precious metals also finished higher for the day. Silver jumped 3.6% while platinum and palladium picked up 0.6% and 0.2%, respectively.

At the Comex close: February gold edged up $1.60 to $1,234.40; March silver jumped 59 cents to $17.16; April platinum gained $6.80 to $1,247.80; and March palladium picked up $1.60, to $815.70 an ounce.