Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.5% to close above $1,728 as the dollar retreated from 20-year highs, lifting alternative stores of value. The metal finished the week 0.4% higher.

The dollar fell 0.6% against major rivals as the euro rallied behind the European Central Bank's decision yesterday to raise its benchmark interest rate by 75 basis points, the biggest hike since 1999. The EU energy crisis resulting from Russian supply reductions has caused inflation to surge, forcing the ECB to act.

A falling dollar lifts gold and other commodities by making it less expensive in other currencies, supporting demand overseas.

Gold's gains came despite an uptick in risk appetite. All three major US indexes climbed sharply, with the Dow adding 1.2% while the S&P 500 rose 1.5% and the Nasdaq 2.1%. After three straight weeks of losses, Wall Street benefitted from bargain-hunting more than a perceptible shift in economic fundamentals.

Benchmark 10-year Treasury yields ticked slightly higher while 2-year Treasury yield surged to the highest level since 2007, inverting the yield curve to the biggest spread in a month. An inverted curve often presages recession.

The other precious metals were higher for the day and week. Silver rose 1.8% today and 5% this week. Platinum picked up 1.2% for a weekly rise of 7.2%. Palladium gained 1.2% today and 7.5% this week.

At the Comex close: December gold rose $8.40 to $1,728.60; December silver futures added 32 cents, to $18.77; October platinum picked up $10.50, to $876.90; and December palladium gained $30.60 to $2,177.60 an ounce.