Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold dropped 0.6% to close under $1,864 as investor grew defensive ahead of tomorrow's release of the consumer price index for January. It was the metal's lowest finish in five weeks.

Consumer inflation is expected to have risen by 0.5% in January, driven by higher food and energy costs. It would be the biggest increase in three months, raising concerns that the tide of inflation has not turned, and the Fed be more inclined to keep raising interest rates following January's blowout jobs report.

Higher interest rates typically weigh on gold by boosting yields and the dollar, making them more as stores of value.

Also weighing of sentiment for gold, Wall Street rallied behind strong performances from tech giants Microsoft, Nvidia, Apple, and Amazon today. The Dow and S&P 500 jumped 1.1% each while the tech-heavy Nasdaq added 1.5%.

Bond yields were mixed heading into the crucial inflation print. The 2-year Treasury yield, most directly correlated with interest rate expectations, pressed back above 4.5% to its highest level since November. Benchmark 10-year yields slipped slightly on worries that higher rates may push the economy towards recession.

Tracking lower with 10-year yields, the dollar retreated 0.2% after last week's strong rally, limiting gold's slide today. A falling dollar makes the metal less expensive overseas, supporting demand.

The other precious metals were mixed, with silver sliding 1% while platinum and palladium rose 0.8% each.

At the Comex close: April gold slipped $11 to $1,863.50; March silver shed 22 cents to $21.85; April platinum picked up $7.60, to $959.40; and March palladium rose $11.60 to $1,536.50 an ounce.