Daily Gold Update

Source:Matt Warden, American Gold Exchange

AustinMixed U.S. economic data, lingering uncertainty surrounding U.S. – China trade negotiations, and fresh lows in U.S. Treasury note yields led to a choppy day in the gold market, finishing the day 0.2% higher to close at $1531.20.

Strong July U.S. retail sales data was offset by a weak industrial production report, sending mixed signals about the health of the U.S. economy. July retail sales increased 0.7% with strong sales online and at retail stores, while industrial production decreased 0.2% with broad bases declines in durable and non-durable goods. With manufacturing output declining for the past two quarters and now in a technical recession, U.S. economic growth remains squarely on the shoulders of the U.S. consumer.

In a short statement overnight, China's State Council Tariff Committee said the new 10% tariffs announced in early August, originally set to take effect on September 1 but now partially delayed until December 15, have taken the U.S. and China off the track of resolving their dispute through negotiations and noted that China “has no choice but to take necessary measures to retaliate”, without specifying what measures would be taken. Uncertainty surrounding the U.S. – China trade dispute have increased investor demand for safe-haven assets like gold.

10-year U.S. Treasury note yields neared all-time lows today, falling to 1.477% in afternoon trade. 30-year U.S. Treasury note yields plunged to new all-time lows as well, dropping below 2% for the first time ever, to as low as 1.926%. Lower U.S. Treasury note yields buoy demand for gold because the opportunity cost of owning gold is lessened.

The other precious metals were mixed for the day, with silver and platinum down by 0.4% and 0.9%, respectively, while palladium added 1.6%.

At the Comex close: December gold ended the day up $3.40, closing at $1,531.20 per ounce; September silver dropped 7 cents to $17.21 per ounce; October platinum fell $6.00 to $842.00 per ounce; September palladium rallied $22.20 to $1,438.60 per ounce.