Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold rose 1% to close at one-week high above $1,910 despite rallying stocks as uncertainty surrounding the US presidential election stoked appetite for both risk assets and safe havens. It was the metal's third straight winning session.

With Joe Biden holding a commanding lead in national pre-election polls, all three major US stock indexes jumped nearly 2% and the Global Dow surged 3.5% as the markets priced in the possibility of a Democrat blue wave.

While by no means assured, a Biden victory and a Democrat majority in the Senate would likely lead to substantially larger increases in fiscal spending for pandemic relief and infrastructure. Gold rose alongside stocks on the view that bigger fiscal stimulus means deeper debt and deficits, currency devaluation, and increased risk of higher long-term inflation.

But with President Trump close enough in swing states to win the Electoral College, investors also turned toward safe havens on a parallel concern that a contested election outcome could result in economic and social turmoil, even violence.

The dollar fell 0.6% against major rivals, supporting gold and other commodities priced in it for global trade by making them less expensive oversees. Analysts believe a Biden administration would advocate freer trade and looser monetary policies, which could lift other currencies while pressuring the buck.

Gold was also supported by sharply higher oil prices. WTI crude jumped 2.8% to a one-week high above $37.80 per barrel after OPEC+ signaled a reduction in production limits. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

The other precious metals were also higher, with silver adding 1.3% while platinum rose 1.8% and palladium climbed 3.5%.

At the Comex close: December gold gained $17.90 to $1,910.40; December silver added 20 cents, to $24.33; January platinum picked up $15.50 to $875; and December palladium climbed $77.40 to $2,297.80 an ounce.