Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold rose 0.2% to close above $1,947 as the dollar weakened on hawkish comments from the Bank of Japan and investors positioned themselves for this week's inflation report. It was the metal's second straight day of gains.

BOJ Governor Kazuo Ueda suggested over the weekend that the central bank might end its policy of negative interest rates sometime this year if wages and inflation continue to rise. The BOJ has held rates below zero since January 2016 to stimulate the economy.

Yields on benchmark 10-year Japan government bonds jumped to the highest level since 2014, pulling up EU and US yields in sympathy. Benchmark 10-year Treasury yields rose to just under 4.3%, capping gold's rise by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The dollar fell 0.5% against major rivals and more against the yen as traders readied for Wednesday's release of the August CPI. A falling dollar lifts gold and other commodities by making them less expensive overseas.

A weak CPI print would almost certainly lessen the likelihood of further rate hikes from the Fed, which would be bearish for the dollar and bullish for gold. Fed fund futures traders see a 93% chance that the Fed will pause rate hikes when it meets next week, while the odds of a quarter-point increase in November stand at 41%.

Gold also received some safe-haven bids after the CBO projected that the federal budget deficit will double to $2 trillion this year. Investors are worried that the ballooning shortfall will become increasingly difficult to finance with interest rates at their currently elevated levels.

The other precious metals were also higher, with silver climbing 0.9% while platinum and palladium picked up 0.8% and 2.3%, respectively.

At the Comex close: December gold gained $4.50 to $1,947.20; December silver rose 21 cents to $23.38; October platinum advanced $7.50 to $902.30; and December palladium jumped $26.90 to $1,219.20 an ounce.