Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold fell another 1.1% to close at $1,091.50 as surging U.S. home sales buoyed the dollar, further diminishing demand for alternative stores of value. It was gold's tenth straight down session and first close under $1,100 in more than five years.

Sales of existing home jumped in June to the highest level in more than eight years, the National Association of Realtors reported today. Following last week's data showing increases in housing starts and building permits, the report suggests the housing recovery may gather momentum through the end of the year because of pent-up demand and low inventory.

The dollar gained 0.4% against a basket of major rivals as traders viewed surging homes sales as evidence that the Fed may raise interest rates in September despite softening payrolls and retail sales data. A stronger dollar weighs on gold and other commodities denominated in it for international trade by making them more expensive to users of other currencies.

Gold is by no means the only commodity to be swamped in the wake of the dollar's rally. Propelled by expectations that the Fed will tighten monetary policy while most other major central banks continue to ease, the U.S. Dollar Index has risen 7.8% so far this year while the Bloomberg Commodity Index has tumbled 7.6%. Gold and silver have held up a little better, sliding 7.2% and 5.2%, respectively, year to date.

Today, the other precious metals also finished lower, with silver and palladium dropping 0.4% while platinum lost 0.5%.

At the Comex close: August gold fell $12 to $1,091.50; September silver for delivery dropped 5 cents to $14.73; October platinum shed $4.40 to $979.90; and September palladium gave up $2.70 to $626.75 an ounce.