Gold News

Gold Gains as Dollar Slides, Treasury Bond Yields Fall to New Record Low

From Chris Mullen at

Gold fell $14.77 to $761.63 by late trade in Asia on Tuesday, before bouncing to $785.80 by the New York start.

Gold Bullion then fell back off into the close, but it still ended with a gain of 0.84%.
Oil ended nearly 5% lower on more evidence that demand is falling. It was also reported that Opec has not yet cut output as much as the oil-rich nations had earlier agreed.

The Dow, Nasdaq, and S&P rose to find nice gains in morning action before they fell back near unchanged in early afternoon trade after GM and the automakers released another set of dismal sales numbers.

All three indices rallied back higher in late trade and ended with decent gains after the fed announced that they will extend their credit programs even further into the future.

The Dollar slid vs. the Euro and its other major currency pairings as the stock market rebounded.

Treasuries rose, however, sending yields on 30-year bonds to a record low, on speculation that inflation will remain subdued. The Federal Reserve may also purchase US government securities as the recession deepens to prevent longer-term interest rates rising in the open market.

Silver fell $0.24 to $9.15 by late trade in Asia and rose to see a $0.32 gain at 09:00 EST, but it also backed off from that high in the last several hours of trade to end with a gain of 1.49%.

The Gold Price in Euros rose to about €616, platinum rose $1 to $802, and copper fell a couple of cents to about $1.58.

Gold Mining and silver equities rose about 6% at the open and remained near that level for most of the morning and early afternoon. They then fell back off in mid-afternoon action, but they then shot back higher in the last hour of trade and ended at new session highs with gains of over 6.5% for the day.

There were no major US economic reports. Wednesday at 12:15 GMT brings the private-sector ADP Employment numbers for Nov., expected at to show a drop of 200,000. Then comes third quarter US Productivity (expected up 0.9%) and then the ISM Services report for November, followed by the Fed's Beige Book of economic analysis.

Chris Mullen is chief content manager of the GoldSeek family of websites, a leading source of gold news, comment and mining-stock data for private and institutional investors.

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