Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dipped 0.1% to close just above $2,032 after more upbeat employment data further clouded the outlook for rate cuts from the Fed, nudging up yields and the dollar while pressuring alternative assets.

First-time claims for unemployment benefits fell by 9,000 to 218,000 last week after hitting a three-month high of 227,000 the week before. Following last week’s blockbuster nonfarm payrolls report showing 353,000 new jobs added in January, nearly doubling forecasts, the data suggest resilience in the labor market that could delay the Fed’s pivot to rate cuts.

Fed fund futures traders now put the odds of a May rate cut at 63%, down from more than 90% just weeks ago.

Benchmark 10-year Treasury yield inched higher on the shifting rate viewed, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Tracking higher with yields, the dollar added 0.1% against major rivals, weighing on gold and other commodities by making it more expensive in other currencies.

China’s consumer prices plunged by the most in 14 years last month and producer prices also dropped, pushing the world’s second-largest economy toward deflation. China has been struggling with falling prices since the pandemic, cutting interest rates recently while other major economies were raising.

The other precious metals were mixed, with silver and platinum picked up 1.3% and 0.8%, respectively, while palladium shed 0.9%.

At the New York spot close: gold dipped $3 to $2,032.20; silver rose 28 cents to $22.64; platinum added $7.10, to $894; and palladium declined by $8.20 to $892.10 an ounce.