Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold dropped 0.9% to cap a weekly loss of 3.5%, its biggest this year, as traders continued preferring risk assets to safe havens. The Dow and S&P 500 both closed at new record highs despite data indicating that consumer spending fell in April, and consumer sentiment softened in May. Gold finished the month down 3.9% on rising risk appetite and receding worries about violence in the Ukraine.

The dollar gained against the pound and euro for the week and month, further pressuring precious metals, which tend to fall when the dollar rises because they are denominated in the U.S. currency for international trade and become more expensive to holders of other currencies.

Traders see the current price weakness as driven by technical factors including the need of hedge funds for month-end liquidity to cover bad bets on bonds. Bullish factors for gold in coming weeks include the lifting of import restrictions in India, the world's second largest gold-buyer, as the Indian wedding season approaches; continued diversification into gold by central banks, especially in China and Russia; and the near-certainty that the ECB will launch some form of quantitative easing in June, devaluing the euro and building inflation pressures.

Silver shed 1.8% today for losses of 3.5% and 3.9% on the week and month, respectively. Platinum gave up 0.5% today and 1.4% this week but gained 1.7% in May behind ongoing strikes in South Africa. Palladium bucked the trend today by adding 0.2% for the day, 0.6% for the week, and 3% for the month, largely because the threat of sanctions against Russia, the world�s larges producer, caused worries about supply interruptions.

At the Comex close: August gold dropped $11.10 to $1,246; July silver lost 33 cents to $18.68; July platinum surrendered $7.40, to $1,452.70; and September palladium picked up $1.85 to $836.35 an ounce.