Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dipped 0.1% to close under $1,479 as upbeat US data and a stronger dollar eroded demand for alternative stores of value.

US home builder confidence soared in December to the highest point in two decades, according to the National Association of Home Builders. Low mortgage rates, modest unemployment, high demand for homes, and a dearth of existing inventory are driving the optimism.

New home starts and construction permits have also risen, fueling expectations for a resurgence in the crucial sector after a downshift in momentum earlier this year.

The dollar rose another 0.2% against major rivals as traders speculated that an improving economic outlook may mean no more rate cuts from the Fed in 2020 after three this year. A softer dollar pressures gold and other commodities by making them more costly in other currencies.

Although the Fed's dot plot from their December meeting signaled no rate reductions next year, financial markets were pricing in one more, nonetheless. But after last week's progress toward a "phase one" trade agreement with China, and this week's solid data on manufacturing and housing, the odds of a 2020 reduction have fallen below 50%, according to CME FedWatch, down from 64% a week ago.

The other precious metals were mostly lower, with silver and palladium dropping 0.1% and 1.2%, respectively, while platinum gained 0.6%.

At the Comex close: February gold slid 1.90 to $1,478.70; March silver slipped 2 cents to $17.05; January platinum added $5.90, to $935.70; and March palladium dropped $22.40 to $1,896.20.