Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold slid 0.3% to close under $1,316 as Congress reached a budget deal, strengthening the dollar and reducing demand for alternative stores of value. The metal ended the week down 1.6% for its biggest weekly drop since early December.

Congress approved, and President Trump signed into law, a new two-year federal budget that increases spending by around $300 billion for military and nonmilitary programs. The agreement came after Senator Rand Paul, a deficit hawk, delayed the vote to force a brief shutdown of government in protest. According to JP Morgan, the new budget will raise the federal deficit to 6% of GDP by 2019, which is unprecedent during a time of full employment.

The dollar pushed 0.2% higher as traders speculated that the deal will add to inflationary pressure, possibly spurring the Fed to raise interest rates more aggressively. The buck closed the week around 1.3% higher for its best weekly performance in nearly 14 months, driven by turmoil in global stock markets. A rising dollar tends to pressure gold and other commodities prices in it for global trade by making them more expensive overseas.

The other precious metals were mixed on the day but lower for the week. Silver lost 1.2% today for a 3.4% weekly decline. Platinum dropped 1.7% on the day and 3.8% on the week. Palladium edged 0.1% higher but still lost 7.8% this week.

At the Comex close: April gold slid $3.30 to $1,315.70; March silver dropped 20 cents to $16.15; April platinum dropped $16.90 to $961.50; and March palladium added $1.30, to $963.35 an ounce.