Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold rose 0.2% to close above $1,802 after anemic GDP growth eased pressure on the Fed to tighten monetary policy, undermining the dollar and lifting alternative stores of value.

The US economy slowed to a crawl in the third quarter, growing at just 2% for the slowest quarterly increase in more than a year. The Delta variant and supply shortages slammed consumer spending, the engine of the economy, which rose just 1.6%.

Separately, the US housing market cooled more than expected, with pending home sales falling 2.3% in September as every US region posted a decline. Year-over-year sales fell 8%. The housing market has been a bright spot for the economy during the pandemic.

The dollar tumbled 0.5% against major rivals as traders speculated that a slowing economy may the keep the Fed from tapering stimulus–or raising interest rates–too quickly despite sharply higher inflation. A weaker dollar supports gold and other commodities priced in it for global trade by making the less expensive overseas.

Treasury yields edged slightly higher, with most gains coming in short-duration notes as the yield curve, or the difference between short- and long-dated government bonds, continued to flatten. The spread between 2- and 10-year US yields narrowed to the smallest in two months yesterday, while the gap between 5- and 30-year yields were the flattest since March 2020.

Typically associated with slowing economies, flattening yield curves register worry in the bond markets that the Fed and other global central banks, eager to stave off inflation, may hit the brakes on the recovery by raising interest rates when growth is already stalling. An inverted yield curve often presages recession.

The other precious metals were mostly higher, with platinum and palladium rising 0.5% and 0.8%, respectively, while silver dipped 0.3%.

At the Comex close: December gold gained $3.80 to $1,802.60; December slipped 7 cents to $24.12; January platinum added $4.60, to $1,023.90; and December palladium picked up $15.10 to $1,989.40 an ounce.