Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinReopening after the MLK holiday, New York spot gold gained 0.4% to close at $2,755 as Treasury yields and the dollar tumbled on uncertainty about Trump administration tariff plans. It was the highest finish for bullion in more than two months. Silver jumped 1.2% to end at $31.31 an ounce.

Amid a flurry of executive orders delivered within hours of taking the oath, President Trump notably did not enact his long-promised tariffs on friends and foes alike. And although he said he is “thinking bout” 25% tariffs on Mexico and Canada effective on February 1, he offered no firm details.

Benchmark 10-year Treasury yields pulled back as investors, uncertain about Trump policies, sought safety in government debt and gold. Falling yields support gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar plunged 1.2% against major rivals on the tariff disappointment, supporting gold and other commodities by making it less expensive in other currencies, encouraging overseas demand.

Forex traders had front-run an immediate enactment of levies on trade, which would likely be highly inflationary and therefore limit the Fed’s rate-cut cycle. The dollar’s sharp fall was in part an unwinding of that anticipatory trade.

Limiting gold’s gains, oil fell 2.3% after Trump declared a national energy emergency, expediting permits for drilling, while simultaneous pulling out of an international agreement on curbing climate change. Traders expect the moves to add more oil to a market that is already experiencing a supply glut. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

Platinum and palladium rose 0.6% and less than 0.1%, respectively.

At the New York spot close: gold gained $10.70 to $2,755; silver surged 36 cents to $31.31; platinum picked up $61.0 to $957.20; and palladium added 30 cents, to $960.80 an ounce.