Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold rose 0.2% to close at a 17-week high of $1,322.50 as oil rallied and the dollar fell, boosting demand for alternative stores of value.

Oil surged 1.5% to a three-year high above $64.60, supported by reductions in US production and steady declines in domestic stockpiles. Rising geopolitical risk in the Middle East, pipeline disruptions in Libya, and OPEC's agreement to extend production cuts have also contributed to bullish sentiment. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

The dollar fell another 0.5% against major rivals after minutes from the last European Central Bank meeting revealed that monetary easing may be further reduced because of rising inflation in the Eurozone.

Also weighing on the buck, the producer price index fell 0.1% in December, with prices for wholesale goods unchanged and service prices 0.2% lower. The core PPI, which strips out volatile food and energy prices, rose 0.1%. For the year, wholesale inflation was 2.6%, the strongest in in six years.

The other precious metals were mixed, with platinum adding 1.2% while silver and palladium slid 0.4% and 0.1%, respectively.

At the Comex close: February gold gained $3.20 to $1,322.50; March silver slid 7 cents to $16.97; April platinum climbed $12 to $990.80; and March palladium dipped $1.15 to $1,076.25 an ounce.