Gold & Silver Creep Higher; US Inflation Jumps at 17-Year Record Pace

From Chris Mullen at GoldSeek.com...

Gold and silver rose in Asia and London on Friday before they fell back ahead of the long Labor Day weekend in New York, ending near their late session lows.

For the week, Gold rose overall, but it added just 0.2%. Silver rose 0.5% from the Friday before.

The Gold Price in Euros stayed at about €566, platinum gained $4 to $1477.5, and copper remained at about $3.43.

Gold and silver equities fell roughly 1% by late morning on Friday, and lingered at about that level for the rest of the day.

On the data front, the Federal Reserve's preferred gauge of prices, which excludes food and fuel, climbed 0.3% for a second month. The so-called core price measure was up 2.4% from a year before – the sharpest rise since Feb. ‘07.

US Personal Incomes fell in July, meantime, down 0.7% against analyst forecasts of just a 0.2% drop.

All told, the latest US price report – tied to spending patterns – jumped 4.5% from July last year, the biggest 12-month gain since 1991.

Crude oil meantime rose in early trade Friday, as Gustav strengthened heading towards the Gulf of Mexico. That inspired traders to cut any short positions going into the long weekend, but gains pared in late trade and turned to a small loss at the close after forecasts began to call for the storm to head further north and cause less damage than previously thought.

The US Dollar index – which fell in early trade as oil rose – recovered to find a slight gain by the close after oil erased its gains.

Treasuries fell as interest rates rose on better than expected readings from Chicago PMI and Michigan Sentiment. The Dow, Nasdaq, and S&P fell about 1% on those disappointing Personal Income figures, as well as worrisome comments from Dell, and worries over Gustav.

Next week’s economic highlights – to follow Monday’s US holiday – include Construction Spending and the ISM Index on Tuesday, Factory Orders and the fed’s Beige Book on Wednesday, ADP Employment, Initial Jobless Claims, Productivity, and ISM Services on Thursday, and August’s jobs data on Friday.