Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold surged 1.2% to close at a 5-week high near $1,515 as concerns about a US-China trade deal and soft US data undercut risk appetite, boosting demand for alternative assets.

China is casting doubts about striking a long-term trade deal, according to Bloomberg, saying it is unlikely to submit to the deep structural reforms demand by the Trump administration. Officials also cited President Trump's unpredictability as an obstacle to a comprehensive agreement.

The report comes on the same day that Chile cancelled the Asia-Pacific Economic Summit for mid-November because of social unrest. Trump and China's Premier Xi Jinping hoped to meet then to sign the limited Phase One trade deal announced earlier this month.

Equities fell on trade pessimism, with the Dow dropping 0.7% and the S&P 500 0.5%. Treasury yields plunged by the most in 12 weeks as investors sought safe havens.

Adding to risk-off sentiment, US consumer spending grew by a scant 0.2% in October, confirming a slowdown in the economy's primary engine. Household spending accounts for around 70% of GDP. Meanwhile, China's manufacturing contracted to an eight-month low in October, adding to worries about slowing global growth.

The dollar dropped 0.3% to hit a 10-day low against major rivals following yesterday's rate cut from the Federal Reserve. Lower rates pressure the dollar by making it less attractive to Forex investors seeking yield. A weaker buck supports gold and other commodities by making them less expensive in other currencies.

The other precious metals were mixed, with silver and platinum rising 1.1% and 0.3%, respectively, while palladium dropped 2%.

At the Comex close: December gold surged $18.10 to $1,514.80; December silver jumped 20 cents to $18.07; January platinum added $3.10, to $933.70; and December palladium fell $36.60 to $1,755.60 an ounce.