Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.5% to close just under $2,000 on bargain-hunting as yields and the dollar weakened ahead of a big week of US economic data, boosting alternative stores of value.

A series of major data dumps this week will help to chart the course of upcoming policy decisions by the Fed. Traders are awaiting reports on consumer confidence, durable goods, and GDP, among others, to provide a clearer picture of US economic health. And the Fed's preferred gauge of inflation, the PCE index, will arrive on Friday.

In the meantime, lingering concerns about growth helped to lift the metal after the Dallas Fed reported manufacturing in the Texas region contracted in April, reinforcing concerns that the Fed's aggressive rate-hike cycle is taking a toll.

Tough talk about inflation last week from several Fed members helped to rally the dollar and yields, pressuring gold into a 1.3% weekly decline to finish under $2,000 for the first time in three weeks.

Benchmark 10-year Treasury yields pulled back today to a one-week low near 3.5%. Softer yields supporting gold by decreasing the opportunity cost for holding it instead of

The dollar also retraced some of its gains, dropping 0.5% against major rivals led by the euro as traders see the ECB raising rates by 50 basis points at its next meeting while the Fed is 91% certain to hike by half that, according to CME FedWatch. A falling dollar lifts gold by making it cheaper overseas.

US benchmark WTI crude posted a second day of gains, rising 1.1% to nearly $79 per barrel on the halt of Iraqi oil exports via pipeline to Turkish ports. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

The other precious metals were mixed, with silver climbing 1% while platinum and palladium fell 3.6% and 4.5%, respectively.

At the Comex close: June gold gained $9.30 to $1,999.80; May silver added 25 cents, to $25.31; July platinum fell $41 to $1,097.70; and June palladium shed $73 to $1,534.40 an ounce.