Gold News & Info

Source: Dr. Bill Musgrave, American Gold Exchange

Austin— Gold finished virtually flat today, dipping 10 cents to hold above $1,241, as mixed U.S. economic data created another volatile session. The Conference Board reported consumer confidence plunging to a seven-month low in November, dragged down by pessimism about the job market. The dollar slipped on the news, helping gold to rise as high as $1,249 in intraday trade. A falling dollar supports gold and other commodities denominated in dollars for international trade by making them less expensive for holders of other currencies.

Gold's early gains eroded, however, after the release of data showing notable strength in the U.S. housing sector. Building-permits for new homes rose to nearly a six-month high in October and home prices rose substantially in September. Traders viewed the data as supporting the chances of a December taper of quantitative easing, the Fed's program of buying $85 billion in long-term bonds each month. QE has supported higher gold prices by flooding the economy with liquidity, devaluing the dollar and increasing the risk of long-term inflation.

Demand for physical gold in Asia is picking up on the recent drop in prices, with trading volumes on the Shanghai Gold Exchange rising to a two-week high. China's gold purchases are expected to reach a new record this year, lending support to global gold prices. The other metals finished the day with losses. Silver slipped 0.2% while platinum and palladium fell 0.4% and 0.5%, respectively.

At the Comex close: February gold dipped 10 cents to $1,241.50; March silver slipped 3 cents to $19.89; January platinum dropped $5.90 to $1,371; and March palladium lost $3.70 to $718.45 an ounce.