Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinExtending its epic rally to nine consecutive sessions, gold gained another 0.5% to close above $1,953, another all-time record finish, as the dollar resumed its decline. The metal then rallied further in electronic trade, nearing $1,975 before easing back slightly, after the Federal Reserve underscored its commitment to extreme monetary easing.

At the conclusion of its July meeting on policy, the Fed reiterated its pledge to use "the full range of its tools" to help the economy rebound from its virus-induced plunge. Underscoring the dangers of the pandemic resurgence for future growth, the central bank agreed to keep interest rates near zero and maintain quantitative easing at $120 billion per month for the foreseeable future.

From April through June, the economy plummeted an astonishing 35% as society and commerce closed to combat COVID-19. It was the biggest drop in quarterly drop in GDP since the government began tracking it in 1947, and more than four times the worst quarterly tumble of the Great Recession, which was 8.4%.

The dollar resumed its recent slide against major rivals, dropping 0.3% before the Fed's announcement and another 0.2% after it. Expectations that the US economy will lag Europe and China in recovering from COVID-19 have driven the buck to a two-year low and further weakness is widely anticipated.

A falling dollar lifts gold and other commodities priced in it for global trade by making them less expensive in other currencies, boosting overseas demand.

The other precious metals were mixed, with silver rising 0.1% while platinum and palladium, more directly tied to industry, dropped 2.2% and 4.4%, respectively.

At the Comex close: August gold gained $8.80 to $1,953.40; September silver rose 2 cents to $24.32; October platinum dropped $27.70 to $958.50 an ounce and September palladium lost $104.30 to $2,261.20 an ounce.