Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold eased 0.1% to close under $1,800 as most markets hit pause ahead of tomorrow's start of the Fed's two-day meeting on monetary policy. It was the metal's lowest finish in three weeks.

With inflationary pressure at a 30-year high, the Fed has been expected to use this meeting to signal its intention to start tapering monetary stimulus sometime this year. But the aggressive delta variant of the coronavirus, which has exploded at home and abroad, has suddenly thrown economic growth–and the Fed's next move–into question.

Global supply chains, already struggling after last year's shutdowns, have come under renewed strain by the upsurge in pandemic infections and deaths. In addition, extreme flooding in Europe and China have further impaired the flow of goods and raw materials. And rising tensions between the US and China on issues ranging from trade to computer hacking have further clouded the economic outlook.

Wall Street reflected this uncertainty, with all three major indexes wobbling between small losses and gains, as traders balanced solid corporate earnings for Q2 against the resurgent threats to growth.

Similarly, benchmark 10-year Treasury yields slid to 1.22% after data showed US new home sales fell 6.6% in June, only to edge back up to 1.29% after stocks overcame earlier losses and risk sentiment was modestly rekindled.

Stemming gold's decline, the dollar lost 0.3% against major rivals as traders speculated that the Fed's forward guidance will continue to be solidly dovish considering the delta variant and troubled global outlook. A weaker dollar supports gold and other commodities by making them less expensive in other currencies.

The other precious metals were higher, with silver adding 0.3% while platinum and palladium rose 0.8% and 0.6%, respectively.

At the Comex close: August gold dipped $2.60 to $1,799.20; September silver picked up 9 cents to $25.32; October platinum gained $8.60 to $1,070; and September palladium rose $18.70 to $2,678.10 an ounce.