Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained another 0.5% to close at a 17-month high near $1,363 as yesterday's comments by Treasury Secretary Steven Mnuchin continued to undermine the dollar. The metal then reversed direction in electronic trade, dropping under $1,350 after President Trump endorsed a stronger dollar.

Speaking in Davos yesterday, Mnuchin said the weakening dollar is "not a concern" because it supports trade by making US exports less expensive overseas. Reducing the US trade deficit and increasing exports are among the main goals of the Trump Administration.

The dollar promptly plunged more than 1% yesterday as traders viewed the comments as advocating an official, weak-dollar policy. The buck extended those losses early in today's session as gold added another 0.5% to yesterday's 1.5% rally.

Late in today's session, however, gold and the dollar reversed themselves after President Trump contradicted his Treasury Secretary, telling CNBC that Mnuchin's statement was taken out of context and the dollar will get "stronger and stronger" as the economy grows. The dollar jumped to a modest gain on the day and gold retraced by around $12 an ounce to under $1,350 in electronic trade.

The dollar has lost around 12% in the past 13 months. It may have another 10% to fall before it is properly valued, according to a report this week from Institute of International Finance. A weaker dollar typically supports gold and other commodities priced in it for global trade by making them less expensive overseas.

The other precious metals finished mostly higher and then lost ground after hours. Silver gained 0.7% before falling 1.1% in electronic trade. Platinum rose 1.6%, then pared its gains to 0.2%. Palladium slipped 0.8% and then fell by another 0.5%.

At the Comex close: February gold gained $6.60 to $1,362.90; March silver added 13 cents, to $17.62; April platinum climbed $16.30 to $1,032.10; and March palladium contract fell $8.90 to $1,097.40 an ounce.