Gold News & Info

Source:Bill Musgrave, American Gold Exchange

AustinGold surged 1.8% to close above $1,750 after weak US growth and a less-hawkish Fed combined to lower bond yields and boost safe-haven assets. It was the metal’s biggest one-day rise since March. Silver soared 7% to $19.87, its highest finish ion a month.

Measured by GDP, the US economy shank at an annualize 0.9% in the second quarter, marking its second consecutive quarterly decline. GDP had fallen 1.6% during Q1, according to government reports.

The surprisingly weak data exacerbates debates over whether the US has already slipped into recession, which is typically defined as two straight quarters of negative growth.

The news comes one day after the Fed raised interest rates by 75 basis points for the second straight month, with the intention of curtailing inflation by cooling off the economy. After the meeting, Fed Chair Powell acknowledged the softening growth data and suggested that the size of the September rate hike will be determined by how the economy is holding up. Traders took this as a dovish signal.

Benchmark 10-year Treasury yields plunged below 2.7% as investors rushed into the perceived safety of US government bonds while speculating the Fed will be unable to raise rates much higher. The spread between 2-year and 10-year yields steepened its inverted curve, something that typically foreshadows recession.

Falling bond yields support gold by decreasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

The other precious metals were mixed, with platinum dipping 0.1% while palladium rose 3.8%.

At the Comex close: October gold gained $31.20 to $1,750.30; September silver rallied by $1.27 to $19.87; October platinum slipped 40 cents to $876.80; and September palladium rose $75.80 to $2,080.20 an ounce.