Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold gained another 0.4%, closing near a four-week high above $1,234, as deepening worries about global growth stimulated safe-haven buying. Holdings in bullion-backed ETFs rose yesterday by the most since July.

German economic sentiment turned negative this month for the first time in two years while the government slashed growth forecasts by one-third for 2014 and 2015. Citing weaker global demand and rising geopolitical turmoil as the main drags on its prospects, Europe's biggest and heretofore strongest economy expects growth of merely 1.2% this year and 1.3% next.

Fund managers are becoming less risk-tolerant, according to a new Merrill Lynch survey, increasingly shying away from equities, especially from Europe and emerging markets. Less than a third expect a stronger global economy in the next year, down 20% from last month.

Another Fed officials came forward to voice concern about the effect of slowing global growth on the U.S. recovery. John Williams of the San Francisco Fed said today that the central bank might have to undertake a fourth round of quantitative easing if the economy falters and we get "a sustained deflationary forecast." After adding $3.5 trillion to its balance sheet since 2008, the Fed is scheduled to end QE3 this month. Tantamount to printing money, QE supports higher gold prices by devaluing the dollar and driving up the risk of long-term inflation

U.S. Treasury prices climbed sharply along with gold on flights to safety as traders fret over growth worries. The other precious metals were mixed. Silver picked up 0.3% and platinum added nearly 1% while palladium fell 2.3%.

At the Comex close: December gold gained $4.30 to $1,234.30; December silver picked up 6 cents to $17.40; January platinum added $11.10, to $1,272.30; and December palladium fell $18.65 to $783.55 an ounce.