Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold dropped 1.2%, logging its first loss in three sessions, as strength in global equities pulled money away from safe-haven investments. The Global Dow added 0.5% and the Italy�s exchange jumped more than 2% on momentum from the ECB�s recent rate cut and expectations of deeper easing in coming months. The S&P 500 broke above 1,800 for the first time ever and the Dow rose above 16,000 before pulling back. Traders took profits from gold�s 1.6% rally of late last week, which occurred after Fed Chair nominee Janet Yellen voiced strong support for maintaining monetary stimulus.

Despite Yellen�s assurances, gold came under additional pressure after the two prominent Fed officials signaled their openness to reductions in quantitative easing, the program of buying $85 billion in long-term bonds each month to stimulate growth and cut unemployment. Charles Plosser of the Philadelphia Fed stated that the Fed �should begin to wind down these asset purchases" because the labor markets are improving. A renowned inflation hawk, Plosser suggested setting a fixed total for QE and ending the program entirely when the amount is reached. William Dudley of the New York Fed, one of QE�s most vocal supporters, said he is "getting more hopeful" that the economy has reached a turning point.

The other precious metals fell harder than gold, with silver dropping 1.8% while platinum and palladium lost 1.9% and 2.2%, respectively.

At the Comex close: December gold fell $15.10 to $1,272.30; December silver dropped 37 cents to $20.36; January lost $27.90 to $1,411; and December palladium shed $15.90, to $716.75 an ounce.