Daily Gold Update

Source:Bill Musgrave, American Gold Exchange

AustinGold tumbled 1.6% to close under $1,296, posting its biggest one-day drop since August, as a rising dollar and falling Treasury prices spurred a technical sell-off.

The dollar rose as much as 0.5%, notching a three-week high, as the UK pound plunged over further Brexit chaos. Other G-10 and emerging market currencies were also weaker against the buck. A rising dollar weighs on gold and other commodities priced in it for global trade by making them more expensive overseas.

The dollar's rise came despite a downward revision to Q4 US GDP from 2.6% to 2.2%, and projected Q1 growth of just 1.3%. Deeper slowdowns in other major economies make the US relatively more attractive to investors, helping to rally to dollar despite the softer data and recent shift away from tighter monetary policies by the Fed.

10-year Treasurys fell and yields rose, normalizing the yield-curve that inverted last week, as risk appetite returned to the markets, further undercutting demand for safe havens like gold. A few large sell contracts on Comex triggered automatic stop-loss selling, accelerating gold's losses into a technical sell-off.

The other precious metals were also lower, with silver dropping 2.1% while platinum and palladium fell 2.1% and 7.9%, respectively. Palladium's heavy losses come as industrial demand rotates toward sister-metal platinum, which is much less expensive in the current market. Both are used for catalytic converters in auto manufacturing.

At the Comex close: June gold tumbled $21.60 to $1,295.30; May silver lost 33 cents to $14.97; July platinum fell $18.40to $843.80; and June palladium dumped $111.80, or 7.9%, to $1,309.70 an ounce.