Daily Gold Update

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold dipped 0.2%, retaining most of Friday�s 1.5% surge, as the dollar rallied against the yen and euro. Japan�s currency tumbled to a four-year low after the Bank of Japan announced a new, two-year easing program that will pump around $1.4 trillion into the economy and double the monetary base. Gold futures leapt almost 5% in Tokyo on the news, nearing an all-time high as investors, as Asian investors sought wealth protection.

The dollar rose against the euro in the wake of Friday�s ruling by the high court of Portugal that the austerity measures required by the EU bailout are unlawful. Barely a week after a meltdown in Cyprus was narrowly averted, Portugal�s fiscal woes have put the possibility of a euro break-up back into play, shifting traders into the dollar as a safe haven. A rising dollar pressures the gold price because gold is denominated in dollars internationally, making it more expensive in other currencies. Silver slipped 0.3% while platinum and palladium added 0.1% and 0.8%, respectively. Capital Economics today projected a 22% gain for palladium by the end of 2014 because of falling production.

At the Comex close: June gold dipped $3.40 to $1,572.50; May silver dropped 8 cents to $27.14; July platinum added $1.50, to $1,537; and June picked up $5.90 to $729.80 an ounce.

More than a dozen states are preparing legislation to recognize gold and silver bullion coins as legal tender. Distrustful of the Federal Reserve and fearful that monetary easing may eventually render the dollar worthless, lawmakers in states including Utah, Kansas, South Carolina, and others are looking to gold and silver as alternative currencies and traditional stores of value. The legal moves are seen as largely symbolic, reflecting growing unrest over monetary policies that some believe may lead to hyperinflation.