Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold fell 0.4% to close at $1,153 as relief over a new bailout for Greece fueled a rally in equities and the dollar, crimping demand for safe havens.

After marathon weekend negotiations, Greece's EU creditors agreed to provide another $96 billion in funds to the nearly-bankrupt nation in exchange for a broad array of rigorous economic and market reforms. While the deal still must be ratified by the Greek parliament, where it is likely to meet stiff resistance, it is nonetheless seen as having the best chance so far of keeping Greece out of default and in the Eurozone.

Equity markets rallied in relief, with the Dow rising 1.2% and the Global Dow 1%. The dollar jumped 0.9%, largely on speculation that the ECB will continue its loose monetary policies while the Fed moves toward tightening. A stronger dollar weighs on gold and other commodities denominated in it for international trade by making them more expensive to users of other currencies.

Possible fallout from the ongoing Greek crisis was viewed as a reason for the Fed to delay raising interest rates. With that risk diminishing, a September hike may be back in the cards�despite recent data showing weakness in the labor markets. Fed Chair Janet Yellen said on Friday that rates are likely to rise this year.

The other precious metals were mostly lower, with silver and platinum dropping 0.5% and 0.2, respectively, while palladium jumped 2.3%

At the Comex close: August gold fell $4.90 to $1,153; September silver dropped 8 cents to $15.40; October platinum slipped $1.80 to $1,030.70; and September palladium jumped $14.75 to $665.10 an ounce.