AGE Daily Gold Update

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

3/5/2025: Gold rises as dollar plunge continues

Source: Matt Warden, American Gold Exchange

Austin — As Bill Bonner of Agora Financial used to say in the early 2000s, it was another GUDD (gold up, dollar down) day in the market. The US dollar posted its third down day in a row, losing an outsized 1.3 points on the US dollar index, or 1.25%, which buoyed gold 0.3% higher to $2915.30 per ounce and silver 1.8% higher to $32.68 per ounce. The dollar fell as mixed US data underscores the increasing likelihood of stagflation in the US.

ADP employment figures for February were released this morning. The consensus forecast was for an additional 148,000 new nonfarm jobs created last month, but it came in at almost half that many, with US businesses adding just 77,000 new jobs – the smallest increase since last summer. The ADP report does not include federal workers – a recent focus of the new government efficiency office - which will be included in this Friday’s US unemployment report.

Today’s ISM services report showed respectably growth in the US service industry, with a reading of 53.5% for February. Any reading above 50% indicates expansion. Hidden behind the good headline numbers was growing nervousness about the effects of potential tariffs and higher cost inputs among the business surveyed. The prices-paid index, a measure of inflation within the ISM report, increased to 62.6%, the third month in a row the reading was above 60%.

Today’s juxtaposed reports highlight the challenges the US Federal Reserve faces as evidence of stagflation continues to grow, with inflationary pressures and inflation expectations rising and US employment growth slowing. For now, the probability remains high, at 93%, that the US Fed will maintain interest rates at their current target of 425-450 basis points at their March 19th meeting two weeks from today.

At the New York spot close: gold added $5.70 to $2915.30; silver jumped $0.75 higher to $32.86; platinum moved $0.80 higher to $967.30; and palladium slipped $0.70 to $945.60.