Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold edged down 0.1% to close under $1,669, pressured by rebounding Treasury yields after upbeat US jobless data and hawkish comments from Fed officials reinforced the prospect of higher US interest rates.

First-time jobless claims fell to a five-month low of 193,000 last week, signaling that the labor market remains strong despite a generally slowing economy. The data is expected to keep the Fed on course to raise interest rates much higher this year to fight inflation.

Cleveland Fed president Loretta Mester said today that rates have yet to become "restrictive," meaning the point at which they slow the economy and reduce inflation. James Bullard of the St. Louis Fed defended plans to push the benchmark rate from the current 3.25% to as high as 4.75% this year.

Data from Germany showed inflation rising almost to 11% in September, much higher than expected, suggesting that the ECB will have to raise rates by another 75 basis points at its next meeting.

Benchmark 10-year Treasury yields pushed back near 3.8% on the hawkish rate view, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Underpinning the gold price, Wall Street resumed its selloff on worries that higher rates at home and abroad will choke off choke off growth and damage corporate profits.

The other precious metals were mostly lower, with silver dropping 0.9% while platinum slipped less than 0.1% and palladium added 1.9%.

At the Comex close: December gold dipped $1.40 to $1,668.60; December silver dropped 17 cents to $18.71; January platinum shed 60 cents to $860.20; and December palladium picked up $42 to $2,211.10 an ounce.