Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinNew York spot gold was nearly flat, inching down less than 0.1% to $2,378.80, as the dollar rose and Treasury yields fell ahead of this weeks Feds meeting and release of important US payrolls data. Silver slipped 0.6% to $27.70 an ounce.

The Federal Open Market Committee convenes its two-meeting on monetary policy tomorrow amid a notable disinflationary trend in the US economy. Fridays PCE release showed the Feds preferred inflation gauge rose by an annualized 2.5% in June, down from 2.6% May. Since March, annualized month-to-month inflation is up just 1.5%, well under the Feds 2% target.

While no rate cut is expected at this meeting, the central bank is expected to open the door for one in September, and perhaps several more this year. If the July nonfarm payrolls report, due Friday, reveals further weakness in the labor market, the odds for multiple rate cuts will increase.

Benchmark 10-year Treasury yields dropped to around 4.18% on the shifting rate view. Falling yields typically support gold by reducing the opportunity cost for holding it instead of bonds for safety.

The dollar rose 0.2% against major rivals, pressuring gold and other commodities by making it pricier overseas.

Platinum and palladium added 1.3% and 0.1%, respectively.

At the New York spot close: gold edged down $1.20 to $2,378.80; silver slipped 16 cents to $27.70; platinum picked up $12.50 to $948.80; and palladium added 90 cents, to $887.80 an ounce.