Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinExtending last week's 0.5% rise, gold edged up another 0.2% to close above $1,781 after US airstrikes against Iranian militias lifted demand for safe havens.

President Biden ordered attacks against an Iran-backed militia group on the Iran-Syria border last night, according to reports from the Defense Department. Targeting weapons storage facilities and operational outposts, the strikes were intended to stop unmanned attacks against US personnel and bases in Iraq. Known as Kataib Hezbollah, the militia group vowed retribution.

Benchmark 10-year US Treasurys rose alongside gold on flights to safety, pressuring yields. Falling yields support gold by reducing the opportunity cost of holding the metal instead of bonds.

Gold's gain came despite an uptick in the dollar, which added less that 0.1% on residual speculation that the Fed may raise interest rates ahead of schedule because of sharply rising inflation. A stronger dollar is a headwind for gold and other commodities because it makes them more expensive in other currencies, reducing overseas demand.

Gold and dollar traders are mostly keeping their powder dry ahead of some important economic reports this week. Consumer confidence data is due tomorrow; the ISM manufacturing survey is coming on Thursday; and most important, the US nonfarm payrolls report is due Friday. All could influence the course of monetary policy and hence the value of the dollar.

The other precious metals were mostly higher, with silver and palladium rising 0.5% and 2.4%, respectively, while platinum slid 0.5%.

At the Comex close: August gold added $2.90, to $1,780.70; July silver picked up 14 cents to $26.22; July platinum dropped $6 to $1,097.60; and September palladium climbed $62.20 to $2,699.40 an ounce.