Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold rebounded 0.4% to close at $1,192 as a new round of weak U.S. economic data weighed on the dollar and increased demand for safe havens.

Factory activity fell more than expected in April, according to Markit's preliminary PMI, signaling that the sharply slower economic growth of the first quarter is continuing into the second. Employment expansion in manufacturing also slowed, while jobless claims rose last week. Sales of new homes plunged more than 11% in March, the biggest decline in 18 months.

Paralleling the U.S. slump, business activity in China, Japan, and Europe also weakened in April, raising questions about the underlying strength of the global recovery and suggesting that yet more stimulus may be required from the world's biggest central banks.

The dollar retreated against major rivals on the softer data, as traders speculated that the Fed will be less inclined to raise interest rates soon. A weaker dollar supports precious metal and other commodities denominated in it for international trade by making them less expensive to foreign buyers.

Oil surged 3% to a 2015-high, boosted by the falling dollar and concerns that escalating Saudi airstrikes in Yemen against Iran-backed Houthi militia may disrupt Middle East supplies. The other precious metals also gained, with silver adding 0.2% while platinum and palladium picked up 0.7% and 1.5%, respectively.

At the Comex close: June gold gained $5.10 to $1,192; May silver picked up 3 cents or 0.2%, to $15.83; July platinum added $7.70, to $1,137.30; and June palladium jumped $11.60 to $767.50 an ounce.