Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinNew York spot gold rocketed over $2,400, adding 1.8% to close at $2,415, after weaker-than-expected CPI data bolstered hopes for a September rate cut from the Fed, pressuring Treasury yields and the dollar. Silver rose 2.2% to finish at $31.39 an ounce.

The consumer price index fell 0.1% in June, pulling the 12-month inflation rate down to 3%. It was the first monthly decline in four years and the lowest annual rate since June 2023. The core CPI, less volatile food and energy costs, rose 0.1%, the smallest monthly increase since August 2021.

After the CPI print, San Francisco Fed president Mary Daly said she is finally ready to support rate cuts, given two straight months of falling consumer inflation and the general cooling of the labor market.

Fed fund futures traders now see a likelihood of nearly 90% that the Fed will lower interest rates in September, up from around 73% before the CPI print.

Benchmark 10-year Treasury fell sharply under 4.2% on the shifting rate view, boosting gold by reducing the opportunity cost for holding it instead of bonds.

Tracking lower with yields, the dollar lost 0.5% against major rivals, supporting gold and other commodities by making them less expensive in other currencies.

Platinum and palladium added 0.8% and 0.5%, respectively.

At the New York spot close: gold gained $42.80 to $2,415; silver surged 67 cents to $31.39; platinum picked up $7.60 to $1,007; and palladium rose $5.40 to $997 an ounce.