Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold slid another 0.6% to close below $1,727 as rising bond yields and hawkish rhetoric from the Fed continued to undercut alternative assets. The metal ended August 3.1% lower for its fifth straight monthly decline, the most since 2018.

Cleveland Fed President Loretta Mester called today for pushing the Fed's benchmark rate above 4%, declaring there is no evidence that "the inflation beast" has peaked, let alone started tracking back down to the central bank's target of 2%

Mester is the latest in a series of Fed officials to reinforce last Friday's aggressive stand by Jerome Powell the Jackson Hole conference. The Fed Chair said rates will rise further and stay high for a long time, even if they cause pain for individuals and businesses.

Benchmark 10-year Treasury yields marched higher on the hawkish chorus, which seems calibrated to drive down market expectations that weak economic data could cause the Fed to pivot away from monetary tightening.

The selloff on Wall Street extended to a fourth session, with the S&P 500 losing another 0.6% to bring its decline to nearly 6% since Powell's speech on Friday.

Adding to risk-off sentiment, ADP reported merely 132,000 jobs were added to private payrolls in August, half of July's 268,000 and less than one-third of June's 480,000.

While gold is often sought as a hedge against rising inflation and declining equities, it is pressured by rising interest rates and bond yields, which increase the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar was little changed, finishing August with a gain of 3% and hovering near a 20-year high. Dollar strength has been a major headwind for gold and other commodities in recent months because it makes them more expensive in other currencies.

The other precious metals were lower for the day and month. Silver fell 2.2% for a monthly decline of 11.5%. Platinum slid 0,6% today and 7.1% this month. Palladium slipped 0.4% for a monthly loss of 2.4%.

At the Comex close: December gold futures dropped $10.10 to $1,726.20; December silver shed 40 cents to $17.88; October platinum slid $5.10 to $827; and December palladium slipped $8.90 to $2,078.90 an ounce.