Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.5% to close near $1,742 as bond yields and the dollar steadied and the Fed reaffirmed its dovish stance on monetary policy. The metal rose 1.3% for the week for its second straight weekly win.

In a Wall Street Journal op-ed piece, Fed Chair Jerome Powell emphasized that the central bank would keep pumping cash into the economy "for as long as it takes." While the outlook "is brightening," Powell wrote, the economic danger has been "grave" and the recovery remains "far from complete."

The remarks echoed the official policy statement released after FOMC meeting this week, in which the Fed pledged to keep interest rates near zero through 2023 and continue quantitative easing at $120 billion per month for an unlimited period.

Tantamount to printing money, quantitative easing floods the economy with cheap cash to stimulate lending and spending. Near-zero interest rates do essentially the same thing. Both are bullish for gold because they undermine the value of the dollar and stoke demand for alternative stores of value.

The dollar was flat and bond yields remained relatively stable, with benchmark 10-year Treasury yields bouncing off session lows following the Fed's announcement of a change to regulatory relief for banks. Beginning April 1, banks will need to hold additional capital for their deposit reserves, a requirement that was suspended because of the pandemic.

Wall Street was mixed, with the Dow falling 0.4% after the reinstated Fed regulation pressured financial shares. But the S&P 500 and Nasdaq added 0.2% and 0.7%, respectively, as the Fed's rededication to easy money propelled high-flying growth and tech stocks.

The other precious metals were lower for the day but higher for the week. Silver dipped 0.3% but held a 1.5% weekly rise. Platinum lost 1.4% but held onto a gain of 0.1% for the week. Palladium slid 1.2% but still surged 11% this week on supply concerns.

At the Comex close: April gold gained $9.20 to $1,741.70; May silver dipped 3 cents to $26.32; April platinum fell $17.40 to $1,200.10; and June palladium shed $31.90 to $2,630.90 an ounce.