AGE Daily Gold Update

AGE Daily Gold Update presents a recap on today's action in the precious metals markets. View archives.

12/16/2024: Gold slips after US services data

Source: Bill Musgrave, American Gold Exchange

Austin — New York spot gold edged down 0.2% to close under $2,652 as Treasury yields ticked slightly higher on better-than-expected US services data. Silver inched down 0.1% to finish at $30.70 an ounce.

The S&P flash services PMI surged to 58.5 in December, the highest in 38 months, as companies grew bullish about the business-friendly Trump administration. Any reading over 50 indicates expansion and over 55 is exceptional. The services sector constitutes more than 70% of the economy.

But in a signal that manufacturing continues to struggle, the Empire State index of business conditions fell sharply in December after a strong showing in November.

Benchmark 10-year Treasury yields rose slightly to just above 4.4% on the upbeat services data and expectations the Fed will give measured forward guidance on interest rates when it meets this week. While another quarter-point cut is nearly certainty, the central bankers are likely to suggest a wait-and-see approach to further reductions in 2025.

Higher yields weigh on gold by increasing the opportunity cost for holding it instead of bonds as a safe-haven asset.

As it has all year, gold remains supported by strong central bank purchases, geopolitical turmoil, and the general trend toward lower interest rates in major economies. These trends are expected to continue in 2025.

Platinum and palladium rose 1.8% and 0.2%, respectively.

At the New York spot close: gold dipped $4.50 to $2,651.40; silver slipped 4 cents to $30.70; platinum picked up $16.20 to $937.50; and palladium added $2, to $955.10 an ounce.