Gold closed Wednesday up $4.30 to $1,313, while silver was down 1.07% to $19.94. Platinum was near steady, gaining $2, while palladium gained $6.
The release of the March minutes of the Federal Reserve Open Market Committee yesterday afternoon gave stocks and precious metals a boost, while the dollar tanked to a 5-month low as investors dumped greenbacks for euros.
One surprising revelation in the minutes was news that the Fed held a secret video conference call two weeks before the March meeting, on how to talk the markets out of their panic over interest rates rising soon. The consensus of the secret meeting was that “forecasts overstated rate rise pace”, showing that the Fed really wants to keep interest rates near zero as long as possible.
Gold hit a 2-1/2 week high of $1,325.90 in early COMEX trading today, while silver surged to $20.49. Platinum hit $1,466, and palladium reached $793.
Gains were moderated by news that first-time jobless claims plunged a staggering 32,000 to 300,000 last week. This is the fewest number of people fired since May 2007, but the government added 6,000 pink slips to last week’s numbers. The four-week rolling average of newly-jobless dropped 4,750 to 316,250. We’ll have to wait until next week to see how far this week’s unusually strong report is modified.
Even with this far-better than expected number, Wall St. opened down and promptly dove deeper in the red.
In more evidence of inflation growing at the Main St. level, import prices for March advanced at triple the rate expected. U.S. imports increased 0.6% from February, which had itself seen a large 0.9% increase.
This has been driven mostly by energy prices, due to the cold winter. Natural gas prices jumped by 21.7% in March. Natgas prices have more than doubled in the last year. Import prices have risen for four months in a row, now. Food prices rose 3.7% just in the last month – not really news to those who do their own grocery shopping.
This may mean that the Fed will be reluctant to act once all the QE trillions given to the banks starts circulating, allowing inflation to build momentum before rates are changed.