Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold fell 0.5% to close near $1,709 as yesterday's surprisingly hot report on consumer inflation kept bond yields and the dollar at elevated levels, pressuring alternative stores of value. It was the metal's lowest finish in more than three weeks.

Released yesterday, the CPI for August showed prices creeping higher as rent, food, and other necessities became more costly despite cheaper gasoline. The unexpected rise in consumer inflation disrupted the optimistic narratives that peak inflation had passed and the Fed might pivot away from aggressive monetary tightening in coming months.

Today's release of the PPI showed wholesale prices declined by 0.1%, mostly on lower gas prices. But the so-called core PPI, stripping our food and energy costs, rose 0.2%, signaling more inflation in the pipeline.

As a result, the Fed is expected to announce another jumbo rate hike when it meets next week to plot monetary policy. Fed funds futures traders have fully priced in another rate hike of at least 75 basis points, with a one-in-three chance of a full 1% increase, which would be the biggest in 40 years.

Benchmark 10-year Treasury yields inched up slightly today after surging yesterday. Higher yields create headwinds for gold because they increase the opportunity cost for holding it instead of bonds.

After rocketing 1.5% higher yesterday, the dollar edged down 0.1% today after the Bank of Japan took the first step toward intervening to support the yen. The buck remains at a two-decade high, which weighs on gold and other commodities by making it more expensive overseas.

The other precious metals were higher, with silver adding 0.4% while platinum and palladium rose 2.5% and 2.9%, respectively.

At the Comex close: December gold dropped $8.30 to $1,709.10; December silver added 8 cents, to $19.57; October platinum picked up $21.70 to $905.40; and December palladium climbed $61.60 to $2,172.70 an ounce.