Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dipped 0.1% to close under $1,700 for the first time since last June after strong jobs data boosted stocks, bond yields, and the dollar. The metal lost 1.8% for the week.

The US economy added 379,00 new jobs in February, more than double most forecasts, as the rollout of Covid vaccines and the pending $1.9 trillion relief package from Congress prompted employers to add workers in many sectors. The unemployment rate dropped to 6.3%.

Wall Street rallied hard after the jobs report, with all three major US indexes recovering from early sessions losses to post big gains. The Dow and S&P 500 rose 1.9% and 2%, respectively, while the tech-heavy Nasdaq added 1.6%.

The bond market route continued, with traders betting that the rebounding economy will stoke higher inflation. Benchmark 10-year Treasury yields touched the highest level in a year and finished above 1.55%. Higher yields are a headwind for gold since it offers no yield itself.

The dollar extended its rise, with the ICE index adding another 0.4% to yesterday's 0.7% to reach a three-month high. Forex traders speculate that rising employment and inflation will prompt the Fed to lift interest rates sooner than expected. Higher rates support the buck by attracting overseas money; a stronger dollar weighs on gold by making it pricier in other currencies.

But Fed officials continued to push back against the idea that monetary policy will tighten anytime soon. Echoing Jerome Powell's comments from yesterday, Atlanta Fed President Raphael Bostic and Cleveland Fed President Loretta Mester separately downplayed the excellent jobs data and emphasized that the economy still has a long way to go.

The other precious metals were lower for the day and mixed for the week. Silver dropped 0.7% for a weekly loss of 4.5%. Platinum slid 0.6% today and 4.8% this week. Palladium also dropped 0.6% but held on to a weekly rise of 0.7%

At the Comex close: April gold dipped $2.20 to $1,698.50; May silver 17 cents to $25.29; April platinum slid $7 to $1,128.30; and June palladium lost $13.70 to $2,329.10 an ounce.