Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 2% to close at $1,896 as a stronger dollar and falling oil prices undercut demand for alternative stores of value. It was the metal's lowest finish since late February.

Concerns over spreading Covid infections in China sparked rallies in bonds and the dollar as mandatory testing began in Beijing. Residents are staying home and stocking up on food in preparation for a possible city-wide shut down.

China's financial center Shanghai has been locked down for two weeks and multiple other cities have faced full or partial closures under China's extreme containment measures.

The disabling pandemic in the world's second-largest economy and biggest manufacturer is casting a pall over the global growth outlook. The latest IMF forecast has China growing at 4.75% over in 2022-23, roughly half the annual average of the past decade.

The dollar rallied 0.6% against major rivals, especially the yuan, as Forex traders sought safety and prepared for sharply higher interest rates from the Fed. A rising dollar weighs on gold and other commodities by making them more expensive in other currencies.

Oil slumped 4% to a two-week low and worries about global energy demand and prolonged lockdowns in China. Gold often trades in sympathy with oil as a hedge against energy-related inflation.

The other precious metals were also sharply lower, with silver and platinum dropping 2.4% while palladium plunged 10.7%.

At the Comex close: June dropped $38.30 to $1,896; May silver slid 59 cents to $23.67; July platinum lost $22.40 to $905; and June palladium shed $254.20 to $2,122.10 an ounce.