Daily Gold Update

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold dipped 0.1% before gaining as much after hours as more bad news from Europe drove investors away from risk. Moody's lowered Germany's AAA sovereign rating to negative from stable because of its exposure to the spreading eurozone debt crisis. Netherlands and Luxembourg, two other stalwarts, also had their outlooks downgraded. The Markit PMI, measuring private-sector economic activity, marked its sixth straight month of contraction in Europe. The dollar extended its gains to new two-year highs while the euro tumbled further. The Dow lost 100 points for the second straight day. The rest of the precious metals complex fell much harder than gold. Silver lost 0.9% while both platinum and palladium fell by 1.6%.

At the close: August gold dipped $1.20 to $1,576.20; September silver fell 23 cents to $26.81; October platinum lost $12.30 to $1,386.60; and September palladium fell $9.35 to $561.60.

Gold was also supported by a late report in the Wall Street Journal that additional monetary easing by the Fed may be coming sooner than previously thought. Reputedly on the strength of inside information, Columnist Jon Hilsenrath wrote that "Federal Reserve officials, impatient with the economy�s sluggish growth and high unemployment, are moving closer to taking new steps to spur activity and hiring." Another round of quantitative easing is possible as soon as their meeting at the end of July, but September is more likely, Hilsenrath says, because they'd like to see more data first. QE3 would almost certainly push gold much higher.