Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold finished nearly flat, edging down less than 0.1% to close at $1,219, as Turkey's deepening currency crisis triggered a sell-off in global stocks, driving investors toward the dollar and safe havens. The metal ended the week down 0.3%.

Turkey's lira plunged more than 16% to historic lows as double-digit inflation and diplomatic problems with the Erdogan government caused financial markets to fear contagion. The currency has fallen 40% this year, in part because of a growing rift with the US over the detention of pastor in Turkey. Compounding its woes, President Trump said today he's doubling tariffs on Turkish steel and aluminum imports.

Global stocks sold off as investor shed risk in favor of safe-haven assets. The Dow fell 1% and the Global Dow lost 1.5%.

The dollar index jumped 0.8% to a 14-month high on fears that Turkey's financial problems may infect Europe and emerging markets. A rising dollar typically pressures gold and other commodities priced in it for global trade by making them more expensive overseas.

On the other hand, contagion fears also fueled flight to safe havens like bonds and gold. US Treasury notes and German bunds rallied, knocking yields lower. And gold received enough safe-haven support to countermand most of the pricing-pressure caused by the surging dollar.

According to the Consumer Price Index, inflation rose 0.2% in July and 2.9% over the prior 12 months. The more closely watched core rate, stripping out food and energy, also rose 0.2% for a 12-month rise of 2.4%. Most of the increase came in shelter costs.

Separately, the federal budget deficit surged 79% in July versus one year ago, as tax receipts fell 3% and government spending jumped 10%. The full-year shortfall is projected to be 19% more than last year, and trillion-dollar deficits will return in 202, according to the CBO.

The other precious metals were also lower for the day and week. Silver fell 1.1% for a weekly decline of 1%. Platinum dropped 0.5% on the day and 0.9% on the week. Palladium slid 0.3% today and 1% this week.