Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold rallied 0.8% to close above $1,871 after renewed tension over Russia's military build-up on the Ukraine border pushed investors into safe havens. It was the metal's eighth climb in nine sessions and highest finish since last June.

Despite Moscow's insistence that it has pulled troops from the Ukraine border, NATO Secretary-General Jens Stoltenberg declared today that it has seen no evidence of drawdowns. Separately, US Secretary of State Anthony Blinken said today that Russia, rather than demilitarizing, has been moving critical units closer to Ukraine.

With worries about a possible Russian invasion back on the table, benchmark 10-year Treasury yields fell as investors shifted from risk to safety. Falling yields typically boost gold by decreasing the opportunity cost for holding it instead of bonds.

Sharply higher import prices also lured investors toward the metal as a hedge against inflation. The cost of imported goods jumped 2% in January, the biggest increase in nearly 11 years, pushing the annual rate to 10.8%. US export prices rose 2.9% last month and 15.1% over the past year.

In a good sign for the economy, retail sales rebounded 3.8% in January after plunging 2.5% in December. But sharply higher inflation is partly responsible for the increase after consumer prices jumped 0.6% in December.

The minutes from the Fed's last meeting showed concern for inflation fueling agreement over rate hikes starting in March. The overall tenor was slightly less hawkish than expected, however, with only two officials wanting to end quantitative easing before then.

The dollar fell 0.2% against major rivals, lifting gold and other commodities priced in it for global trade by making them less expensive overseas.

The other precious metals were higher, with silver adding 1.1% while platinum and palladium picked up 4.2% and 0.9%, respectively.

At the Comex close: April gold gained $15.30 to $1,871.50; March silver added 26 cents, to $23.61; April platinum rose $43.30 to $1,063.70; and March palladium climbed $19.30 to $2,271.60 an ounce.