Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold slid 0.4% to close near $1,720 as bond yields ticked higher on upbeat jobless data and hawkish comments from Fed officials, undercutting alternative assets.

Speaking at a Cato Institute conference, Powell reasserted his stance that the central bank will continue to raise interest rates and keep them high until inflation moves back toward the target 2%. "My colleagues and I are strongly committed" to lowering inflation, Powell vowed, and won’t be influenced by "external political considerations."

Separately, Chicago Fed President Charles Evans called for raising the Fed funds rate to 4% by year end. With the rate current in a range between 2.25% and 2.5%, two more jumbo hike of 75 basis points would be needed in the next few months to achieve this level.

Meanwhile, first-time jobless claims fell to 222,000 last week, the fewest since mid-May. Solid momentum in the labor market is expected to embolden the Fed to tighten rates further without excessive risk of tipping the economy into recession.

Benchmark 10-year Treasury yields pushed back above 3.3% on the hawkish rate view, pressuring gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

Backstopping gold's slide, the dollar slipped 0.1% against major rivals after the ECB voted to increase interest rates by 75 basis points, lending some support to the euro. A weaker dollar buoys gold and other commodities by making them less expensive in other currencies.

The other precious metals were higher, with silver rising 1% while platinum and palladium picked up 2.3% and 6.1%, respectively.

At the Comex close: December gold slipped $7.60 to $1,720.20; December silver rose 18 cents to $18.44; October platinum picked up $19.20 to $866.40; and December palladium rallied $124.20 to $2,147 an ounce.