Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinExtending last week's 1.2% rally, gold surged another 0.8% as traders shifted toward inflation hedges and safe havens. It was the metal's biggest one-day rise in three weeks and highest finish in a week.

Following Friday's strong payrolls data, which showed 476,000 new jobs added in January, more than triple expectations, the risk of policy error by the Federal Reserve is helping to stoke demand for gold despite higher bond yields.

The Fed has clearly telegraphed its intention to rate interest rates in March to fight the strongest inflation in 40 years. But investors are increasingly worried that the central bank is already too far behind the inflation curve. Too much tightening could snuff the recovery while too little could allow inflation to become more firmly entrenched.

Thursday's release of the January Consumer Price index will help to clarify how aggressive the Fed may be in coming months. Economist are projecting the year-over-year CPI to have risen to 7.3%.

Gold was also buoyed to the ongoing tensions between Russia and the West over the Ukraine. Jake Sullivan, a national security advisor to President Biden, told Fox News that a Russian invasion could take place "any day now," although a diplomatic solution is still possible.

Benchmark 10-year Treasury yields pulled back slightly on flights to safety but held at multi-year highs above 1.9%. Higher yields tend to weigh on gold increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The other precious metals were mixed, with silver jumping 2.7% while platinum and palladium lost 0.4% and 1.3%, respectively.

At the Comex close: April gold gained $14 to $1,821.80; March silver rose 60 cents to $23.08; April platinum slipped $4.20 to $1,020; and March palladium slid $30.60 to $2,260.10 an ounce.