Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold gained 0.6% to close near $1,970 as the dollar dropped ahead of Fed Chair Jerome Powell’s speech on monetary policy. The metal then gave back around $5 in electronic trading after Powell suggested higher interest rates might be needed.

Speaking at an IMF conference, Powell said the Fed is “not confident” that monetary policy is yet “sufficiently restrictive to bring inflation down to 2%.” The central bank “will not hesitate” to tighten further, he added. But he also stipulated that meetings will be made “meeting by meeting” with care to avoid “being misled by a few good months of data” and “the risk of overtightening.”

The hawkish posture pushed back somewhat on the narrative that rate hikes are over—one that Powell engendered with relatively dovish comments after last week’s FOMC meeting. Odds of a December January rate increased rose to 15% from 10% before the speech, while the odds of a January hike increased from 17% to 25%, per CME FedWatch.

The dollar shifted from losses before to small gains after Powell’s remarks. A stronger dollar pressures gold and other commodities by making them more expensive overseas.

Benchmark 10-year Treasury yields pushed back above 4.6%, adding to gold’s post-Powell headwinds.

The other precious metals were mixed, with silver rising 0.8% while platinum and palladium fell 1% and 4.8%, respectively.

At the Comex close: December gold gained $12 to $1,969.80; December silver added 18 cents, to $22.91; January platinum slid $8.70 to $862.80; and December platinum plunged $51.30 to $1,009.10 an ounce.