Gold News & Info

Source: Bill Musgrave, American Gold Exchange

Austin— Gold surged 2.1% to close above $1,208 as another round of notably soft U.S. economic data raised bets that the Federal Reserve will defer raising rates until year-end or later.

Manufacturing stalled in March, expanding at its slowest pace in more than a year, with the ISM index falling to 51.5. Exports contracted for a third straight month, constrained by the strong dollar and falling demand overseas. Construction spending dropped in February and was revised sharply lower in January. And perhaps most alarming, private payrolls added only 189,000 jobs in March, according to ADP, the fewest since January of last year.

The weak data raised questions about the ongoing strength on the U.S. recovery, and whether the Fed can afford to raise rates this year without slowing it further. After slowing substantially during Q4 of last year, GDP growth for Q1 is expected to plummet, with the Atlanta Fed projecting a mere 0.3% expansion in the economy.

The dollar retreated on the weak data, pressured further as the euro rallied after reports that Eurozone manufacturing expanded rapidly in March. A falling dollar boosts typically boosts prices for gold and other commodities denominated in it for international trade by making them less expensive to foreign buyers.

The other precious metals finished higher with gold. Silver jumped 2.8% while platinum and palladium gained 2% and 1.8%, respectively.

At the Comex close: June gold surged $25 to $1,208.20; May silver jumped 46 cents to $17.06; July platinum gained $22.90 to $1,166; and June palladium rose $13.55 to $748.85 an ounce.