Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold edged up 60 cents in choppy trade, closing above $1,505 after surging to an intra-day high near $1,521, as late-session optimism about a US-China trade deal offset earlier pessimism about Brexit. The metal still gained 0.8% this week for its second straight weekly win.

The US and China are close finalizing aspects of a limited trade deal, according to a statement issued today by the Office of the US Trade Representative. While the details have not been released, the agreement would mark the first substantial progress in the 16-month trade war that has damaged both economies.

Wall Street rallied on the news, pushing the S&P 500 into record territory as investors pivoted away from safe havens and into risk assets. Treasury yields also rose.

Earlier in the day, gold rallied sharply on new twists in Brexit turmoil. British PM Boris Johnson called for an early general election to break the impasse. Johnson has vowed to crash Britain out of the EU by the October 31 deadline, creating chaos European financial markets. French President Emmanuel Macron reportedly said no extension on the deadline is warranted at this point.

Gold's late-session retracement was backstopped by higher oil prices, with WTI rising another 0.7% to post a weekly gain of nearly 5% on drawdowns in US reserves. Gold often rises with oil as a hedge against energy-related inflation.

The US government ran a budget deficit of nearly 1$ trillion in the fiscal year that ended in September, the biggest gap since 2012 and 26% higher than last year. The deficit is now 4.6% of GDP, up from 3.8%. The Congressional Budget Office has warned that high deficits create headwinds for economic growth and undermine confidence in US credit trustworthiness.

The other precious metals were mixed for the day and higher for the week. Silver added 0.7% for a weekly rise of 2%. Platinum rose 0.9% today and 4.2% this week. Palladium dipped 0.2% for a weekly gain of 1.6%.

At the Comex close: December gold added 60 cents, to $1,505.30; December silver rose 12 cents to $17.93; January platinum picked up $8.20 to $933.30; and December palladium slid $3.70 to $1,744.20 an ounce.