Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold dipped 0.2% to close under $1,062 as higher U.S. core inflation boosted the dollar, eroding demand for alternative assets.

The Labor Department reported today that the core Consumer Price Index, which excludes food and energy costs, rose 0.2% last month, reflecting higher costs for healthcare, rent, and motor vehicles. The overall CPI remained flat, pressured by falling food and energy prices.

After three straight months of identical increases, the core CPI has climbed to 2% annualized for the first time since 2014. The Fed is targeting annual inflation of 2% but uses a different measure, the Personal Consumption Expenditures Index, to track it. The PCE is running at a much lower rate, merely 0.2% annualized through October.

Still, the solid CPI report gives the Fed cover to move forward with a rate hike at the FOMC meeting that begins today. The dollar rallied more than 0.6% in response, putting downward pressure on the gold price. Denominated in dollars for international trade, gold becomes more expensive to users of other currencies when the dollar rises.

Oil jumped more close to 3% after Congress said it may end the ban on oil exports as part of broader spending and tax legislation. Propelled by energy firms, equities rose in the U.S. and Europe, with the Dow and Global Dow both adding around 1.1%.

The other precious metals were higher on the day, with silver gaining 0.6% while platinum and palladium picked up 0.7% and 3.3%, respectively.

At the Comex close: February gold dipped $1.80 to $1,061.60; March silver added more than 7 cents, to $13.77; January platinum picked up $5.60 to $855.80; and March palladium gained $18.25 to $566.95 an ounce.