Daily Gold Update

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold gained 0.7% in thin trade to close above $1,212 as traders covered short positions. Jobless claims fell last week to a one-month and retails sales rose over the last two months as confidence in the recovery appeared to deepen. Orders for durable goods jumped 3.5% last month, well-above expectations, and planned business spending also increased, according to the Commerce Department, indicating greater strength in the manufacturing sector.

The upbeat reports drove the Dow 100 points higher to its fiftieth record close of the year and helped to bid up commodities, including precious metals. Treasury prices fell, pushing yields for 10-year bonds above 3% for the first time since September, in part because of the Fed's decision to begin tapering monetary easing by $10 billion per month starting in January. An unwanted drag on growth, rising Treasury yields are seen as a potential disincentive for the Fed to deepen the QE taper next month.

The other precious metals also rose, with silver surging 2.3% while platinum and palladium gained 2% and 0.8%, respectively.

At the Comex close: February gold gained $9 to $1,212.30; March silver added 44 cents, to $19.92; January platinum picked up $26.20 an ounce to $1,362.70; and March palladium gained $5.30 to $700.75 ounce.