Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.1% to close above $1,970 as yields and the dollar pulled back on mixed US data and yesterday's "hawkish pause" in interest rates by the Fed, boosting alternative assets.

US retail sales rose 0.3% in May, signaling momentum in the economy despite inflation and high borrowing costs. Sales at retailers constitute around one-third of consumer spending, which in turn accounts for around 70% of GDP.

Two regional gauges of manufacturing were better than expected in June, but both were still mired in the weakness that has plagued the sector since the pandemic. New York's Empire Index pushed marginally into the positive after being deeply in the negative in May. And the Philadelphia Fed index fell further into the negative, but not by as much as forecast.

US jobless claims remained at 262,000 for a second week, the highest level since October 2021, as the robust labor market is showing some signs of softening.

The net-negative data comes one day after the Federal Reserve held interest rates unchanged for the first time in 11 meetings, while at the same time signaling as many as two more quarter-point increases this year.

Wall Street brushed off the soft data and hawkish Fed pause, with all three major indexes rising more than 1.2%.

Benchmark 10-year Treasury yields pulled back to 3.73% on the rising risk sentiment. Falling yields help gold by decreasing the opportunity cost for holding it instead of bonds.

The dollar tracked lower with yields dropping 0.8% against major rivals. The euro strengthened after the ECB raised interest rates again and said more rate hikes are on the way.

The other precious metals were mixed, with silver and palladium sliding 0.7% and 0.4%, respectively, while platinum added 1.2%.

At the Comex close: August gold gained $1.80 to $1,970.70; July silver slid 16 cents to $23.95; July platinum picked up $11.90 to $991.90; and September palladium dropped $4.90 to $1,397.30 an ounce.