Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.4% to close near $1,337 as the dollar retreated near three-year lows and oil surged to a three-year high, boosting demand for alternative stores of value.

The dollar lost nearly 0.3% against major rivals, surrendering gains made after Congress voted to reopen the government yesterday. Expectations of tighter monetary policies in the Eurozone, Britain, and Japan are drawing foreign exchange interest toward to the euro, pound, and yen at the buck's expense.

The Institute of International Finance reported today that despite falling more than 10% in 2017, the dollar may still be overvalued by as much as 10% because of the outsized US current account deficit with markets in Asia. A falling dollar supports gold and other commodities priced in it for global trade by making them less expensive in other currencies.

Oil rallied around 1.5% to close above $64 per barrel, the highest level in more than three years, as US crude supplies declined. In addition, Saudi Arabia, OPEC's largest producer, signaled that it may extend production-cuts beyond the current OPEC agreement, which expires at year's end. Gold often trades in sympathy with oil as a hedge against energy inflation.

Investment in gold-backed ETFs climbed to the highest level in four years this week, according to data compiled by Bloomberg, with investors piling into gold as a long-term store of value because of rising global inflation and geopolitical turmoil.

The World Gold Council released a study entitled Gold as a Strategic Asset today, with analysis showing that adding up to 10% in gold to the average pension-fund portfolio reduced volatility and increased returns over the past decade.

The other precious metals were mixed, with silver and palladium dropping 0.5% and 0.7%, respectively, while added platinum 1.1%.

At the Comex close: February gold gained $4.80 to $1,336.70; March silver slid 8 cents to $16.91; April platinum climbed $11 to $1,007.80; and March palladium dropped $8.05 to $1,084.25 an ounce.