Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 1.7% to close at a three-week low under $1,684 as increasing confidence in the recovery stoked bond yields and the dollar, pressuring alternative stores of value.

Consumer confidence jumped in March to the highest level since before the pandemic as vaccine rollouts and stimulus checks lifted optimism. The extension of unemployment benefits and direct payments to many Americans through the $1.9 trillion Biden relief package are providing consumers a rising sense of security in their financial futures.

The optimism comes despite an alarming increase in Covid-19 infections since many regions have relaxed pandemic rules. New cases have increased by 13% nationally over the past two weeks, leading public health officials to warn that the US, like Europe, could see a deadly fourth wave.

The selloff in Treasurys continued anyway, driving benchmark 10-year yields above 1.75% to touch pre-pandemic levels as bond traders bet on sharply higher inflation. While gold is widely sought as an inflation hedge, higher yields typically pressure it by increasing the opportunity cost for holding the metal instead of bonds as a long-term store of value.

The dollar rose with higher bond yields, adding another 0.4% against major rivals as Forex traders bet on a speedier US recovery. A stronger dollar pressures gold and other commodities by making them pricier in other currencies, limiting overseas demand.

The other precious metals were mostly lower, with silver and platinum dropping 2.6% and 2%, respectively, while palladium added 1.5%.

At the Comex close: April lost $28.30 to $1,683.90; May silver shed 63 cents to $24.14; July platinum dropped $23.50 to $1,160.60; and June palladium rose $23.30 to $2,569 an ounce.