Gold hits 2-month low on firm $, US jobless data LONDON: Gold slid around 1 per cent to its lowest in two months on Thursday, extending losses to a fifth session on a firm dollar and after slightly better than expected US jobless claims fed expectations for an early interest rate hike. US policymakers debated whether interest rates should be raised earlier given a surprisingly strong job market recovery, minutes from the July meeting of the Feds rate setting committee showed on Wednesday. On Thursday, the US Labor Department report shoed the number of Americans filing new claims for unemployment benefits fell slightly more than expected last week, pointing to a sustained improvement in labour market conditions. Higher interest rates would dull the appeal of non-interest-bearing assets such as gold. Spot gold fell as much as 1.4 per cent to its lowest since June 18 at $1,273.54 an ounce. It was down 1.3 per cent at $1,275.65 by 1412 GMT. US gold futures fell 1.1 per cent to $1,280. Gold was already on the defensive before the minutes as the tensions in Ukraine were easing and the market was paying less attention ... so you had other drivers like the dollar, which has been moving up since the start of the week, ABN Amro analyst Georgette Boele said. And then you had these less dovish minutes, which put extra pressure on gold, and this is also ahead of tomorrows speech by Yellen at Jackson Hole ... The main topic should be employment, and the way she sounds will be crucial. The US dollar traded just below 11-month highs against a basket of major currencies, buoyed by rising Treasury yields and the slightly hawkish tone in the US central banks minutes. The dollar slipped slightly after the US jobless claims data. The next focus for the market will be Fed Chair Janet Yellens comments at the Jackson Hole central bankers gathering on Friday. Any escalation of violence in Ukraine and the Middle East could, however, prompt investors to temporarily seek safety in gold. Although those conflicts have helped push bullion up around 7 per cent this year, any impetus that they have provided has not lasted long, analysts said. Holdings in the SPDR Gold Trust, the worlds largest gold-backed exchange-traded fund, rose 0.9 tonne to 800.09 tonnes on Wednesday, the third straight daily increase. Silver fell 0.4 per cent to $19.38 an ounce, having earlier touched a two-month low of $19.25. Spot platinum fell to its lowest level in more than three months at $1,407.30. It was down 0.3 per cent at $1,416 at 1414 GMT, down for the ninth consecutive session in the longest losing streak since July 2008. Spot palladium, which hit a 13-1/2 year high of $900 earlier this week before falling back, was up 1.3 per cent at $873.25 an ounce. -Reuters
Posted on: Sat, 23 Aug 2014 10:39:48 +0000
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