Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinPosting its ninth straight winning session, gold added 0.2% to close at $1,318.50 as Iranian turmoil spurred safe-haven demand. The metal then both lost and recouped those gains in electronic trade after the minutes from the Fed's December meeting showed a deep divide over the course of future rate hikes.

Violent protests in Iran over economic hardship stretched to a sixth day, prompting the deployment of elite Revolutionary Guard units in three provinces to quash resistance. The deepest popular unrest in a decade has left 21 dead and shaken the Rouhani government, raising questions about stability in a volatile region.

Oil rallied more than 2% to a three-year high above $61.60 on concerns that the protests may disrupt production from OPEC's third-largest producer. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

After the Comex close, the release of minutes from the Fed's last meeting showed a deep divide over its forecast of three quarter-point increases next year. One large group of members said two is enough, given persistently low inflation, while another group thought four will be needed to prevent instability in financial markets.

Gold quickly dropped $9 an ounce in electronic trade as traders initially viewed the minutes as less dovish than expected and took profits from the recent rally. But in a sign of strong underlying demand, bargain-hunters quickly swept in and bid the metal back over $1,318.

The other precious metals finished mostly higher, with silver and platinum picking up 0.4% and 1.55, respectively, while palladium slid 0.4%.

At the Comex close: February gold added $2.40, too $1,318.50; March silver picked up 6 cents to $17.27; April platinum jumped $14.50 to $962.30; and March palladium slid $4 to $1,083.35 an ounce.