Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold added 0.3% to close near $1,828 despite sharply higher bond yields as investors continued to seek protection from inflation and Russia-Ukraine tensions. It was the metal's third straight winning session and its highest finish in nearly three weeks.

Benchmark 10-year Treasury yields pushed up to 1.97%, nearly a three-year high, on expectations that the Fed will move aggressively in coming months. After last week's strong payrolls report, which showed the economy adding 465,000 jobs in January, the odds of a half-point rate hike in March have surged to three to one, according to the Fed fund futures markets.

Rising bond yields typically weigh on gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset. But with inflation at a 40-year high, real interest rates will remain firmly negative for a long time to come, keeping gold as a cost-effective hedge against loss of purchasing power.

The January Consumer Price Index report is due on Thursday. Most economist project the year-over-year CPI for January at around 7.3%. Eurozone inflation is not far behind, with the region's biggest economy, Germany, hitting 5.3% in December, the biggest jump in 30 years.

Meanwhile, the US trade deficit soared 27% in 2021 to a record $859, driven largely by sharply higher prices for all imports. Large deficits are seen as a drag on GDP.

Limiting gold's rise, the dollar picked up 0.3% against major rivals on the hawkish rate view. A rising dollar weighs on the metal by making it pricier in other currencies.

The other precious metals were also higher, with silver adding 0.5% while platinum and palladium picked up 1.6% and 0.2%, respectively.

At the Comex close: April gold rose $6.10 to $1,827.90; March silver added 12 cents, to $23.20; April platinum climbed $16.30 to $1,036.30; and March palladium picked up $4.10 to $2,264.20 an ounce.