Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold surged 1.9% to close at a 15-month high above $1,290 as soft U.S. inflation and spending data combined with a strong yen to pressure the dollar, boosting demand for alternative assets. Silver jumped 1.3% to $17.82, also a 15-month high.

U.S. inflation hardly budged in March, the Commerce Department reported today, with the so-called "core" personal consumption expenditures (PCE) price index rising 0.1% last month. The Fed's preferred measure of inflation, the core PCE has climbed just 1.6% over the past 12 months, well below the Fed's target threshold of 2%.

Consumer spending, which accounts for roughly 70% of GDP, ticked up by just 0.1% in March, less than projected, as Americans chose to save their money.

The dollar extended its slide against major rivals, with the ICE Dollar Index falling another 0.7%, as traders speculated that weak inflation and slow growth will prevent the Fed from raising interest rates anytime soon.

The Bank of Japan's decision this week to forego additional monetary easing is also pressuring the buck, which dropped another 1% to an 18-month low against the yen. A falling dollar supports gold and other commodities denominated in it for international trade by making them less expensive to users of other currencies.

After rallying for the last five sessions, and gold and silver finished 4.4% and 15.1% higher for April, respectively. Platinum jumped 2.6% today for a 10% monthly gain, while palladium picked up 0.5% today and 11% this month.

At the Comex close: June gold surged $24.10 to $1,290.50; July silver rose 23 cents to $17.82; July platinum gained $27.70 to $1,078.40; and June palladium picked up $3.30 to $627.65 an ounce.