Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold edged down 0.1% to close under $1,945 after Fed Chair Jerome Powell told Congress that further rate hikes are probably coming this year. Gold initially fell under $1,930 before retracing its steps as the market digested Powell's testimony.

In his semi-annual appearance before Congress on monetary policy, Powell reiterated last week's message that as many as two more rate increases are likely to be "appropriate" by year end, although he remained vague on the timing.

Powell's comments shed little new light on policy but notably were not the full-throated endorsement of higher interest rates that many expected. Rather, he underscored that decisions will be made "meeting by meeting," based on "the totality of incoming data" and "the balance of risks."

Fed fund futures traders now see nearly an 80% probability of a quarter-point hike in June, but the odds of a second increase by December are merely 13%.

Benchmark 10-year Treasury yields initially pushed higher but then reversed course after traders found Powell's comments to be less hawkish than anticipated. The dollar also gave up early-session gains to fall 0.5% against major rivals.

The other precious metals were sharply lower, with silver dropping 1.8% while platinum and palladium lost 2% and 2.5%, respectively.

At the Comex close: August gold dipped $2.80 to $1,944.90; July silver shed 42 cents to $22.81; July platinum dropped $19 to $949; September palladium declined $34.80 to $1,344.30 an ounce.