Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 0.8% to close under $1,723 as the dollar rallied again on speculation that the Fed will tighten monetary policy sooner than expected, undercutting alternative stores of value. It was the metal's lowest finish in six months.

In a virtual forum with other central bankers today, Fed Chair Jerome Powell said the current surge in US inflation may extend into next year because of ongoing supply-chain bottlenecks. The inflation rate using the Fed's preferred measure, the so-called PCE, rose 4.2% for the 12 months ending in July, the fastest pace in 30 years.

Powell admitted that negotiating the conflict between high inflation and an underperforming US labor market is the biggest challenge facing the Fed. Raising interest rates to control inflation may, Powell worries, may further weaken job growth in an economy that is still 6 million jobs short of pre-pandemic levels.

The dollar extended its rally, surging another 0.6% to reach a 10-month high on expectations that persistent inflation will force the Fed to tighten rates sometime next year. The buck is up 1.1% this week and 2.1% this quarter, pressuring gold and other commodities by making them pricier in other currencies.

Stemming gold's decline, benchmark 10-year Treasury yields slipped back as investors snapped up bonds for protection from a possible US default after Republican Senators blocked a bill to raise the US debt ceiling.

The other precious metals were sharply lower. Silver plunged 4.4% while platinum and palladium dropped 1.6% and 1.3%, respectively.

At the Comex close: December gold fell $14.60 to $1,722.90; December silver shed 98 cents to $21.49, the lowest close in 14 months; January platinum slid $14.90 to $947; and December palladium dropped $23.90 to $1,830.30 an ounce.