Daily Gold Update

Source: Bill Musgrave, American Gold Exchange

Austin— Gold slipped 0.3%, closing just under $1,221 as the dollar rebounded slightly. The metal still gained 2.4% for the week, its biggest weekly climb since June, while dollar incurred its first weekly loss in more than three months.

Wednesday's release of minutes from the September FOMC meeting showed the central bankers growing increasingly concerned that low inflation, a too-strong dollar, and slowing global growth could undermine the U.S. recovery. Traders speculated that the Fed is therefore less likely to rise interest rates before mid-2015. Lower rates for longer would weaken the dollar, supporting gold and other commodities denominated in it for international trade by making them less expensive.

In a development that could devalue the dollar in the longer-term, the ECB will consider laying the groundwork for adding the yuan to its reserves, according to Bloomberg, which would be a major step toward internationalizing the Chinese currency. Although China has the world's second-largest economy, the yuan is not a significant part of most nations' currency reserves, whereas dollars compose 61% of all holdings. Gravitation toward the yuan in reserves has the potential to reduce the proportion of dollars held by foreign governments, reducing demand.

The other precious metals were also lower on the day but higher on the week. Silver dropped 0.7% today but jumped 2.5% this week. Platinum slipped 0.4% for a weekly rise of $3.6%. Palladium lost 1.8% but finished the week 4.1% higher.

At the Comex close: December gold slipped $3.60 to $1,221.70; December silver lost 11 cents to $17.30; October platinum slid $5.69 to $1,260.50; and December palladium retreated $14.70 to $785.80.