Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold surged another 1.4%, closing at a five-month high above $1,294, on follow-through from last week's Swiss bombshell in the currency markets and expectations of deeper global easing. The metal has gained more than 7% over seven straight sessions in New York, its longest rally in eleven months, and is up more than 9% so far this year.

Markets remain jittery after the SNB unpegged the Swiss franc from the euro last week in a stunning move that sent global investors scrambling for safe havens. With volatility rising in stocks and growth slowing in Europe, Japan, and China, traders are betting that the Fed will postpone raising interest rates, perhaps until 2016, which will support higher gold prices by pressuring the dollar.

At its policy meeting this week, the ECB is expected to announce Fed-Style quantitative easing of as much as one trillion euros in a desperate attempt to combat deflation. Tantamount to printing money, QE undermines currencies and builds demands for alternative stores of value.

China's growth fell to a 24-year low in 2014, it was reported today, in a further sign that the world's second-largest economy is need of additional stimulus. The IMF lowered its global growth forecast, calling on central banks and governments to pursue accommodative policies to promote growth. Such policies are bullish for gold in part because they promote long-term inflation and reduce confidence in paper money.

The other precious metals followed gold higher. Silver added another 1.2% while platinum and palladium gained 1.4% and 3.2%, respectively.

At the Comex close: February gold surged $17.30 to $1,294.20; March silver added 1.2%, to $17.96; April platinum gained $17.20 to $1,286.60; and March palladium jumped $24.45 to $778.75 an ounce.