FU: Gold futures extend losses after U.S. data, falls to fresh 2-day low
Futures Pros – Gold futures extended losses on Wednesday, falling to a fresh 2-day low, following the release of official data on U.S. consumer prices, industrial production and manufacturing conditions.
On the Comex division of the New York Mercantile Exchange, gold futures for February delivery traded at USD 1,387.95 a troy ounce during European afternoon trade, dropping 0.62%.
It earlier fell to USD 1,383.65 a troy ounce, the lowest price since December 13.
Earlier in the day, the Bureau of Labor Statistics said that core consumer prices, less food and energy rose in line with expectations in November, increasing by 0.10%, up from a flat reading in October.
Consumer prices, including food and energy costs rose less-than-expected in November, increasing by a seasonally adjusted 0.1%. Analysts had expected consumer price inflation to rise by 0.2% in November.
Year-on-year, consumer prices rose by 1.1% in November, after rising by 1.2% in October.
A separate report showed that industrial production in the U.S. rose more-than-expected in November, climbing 0.4%, slightly above expectations for a 0.3% increase.
Also Wednesday, official data showed that the New York Federal Reserve’s index of manufacturing conditions rose significantly more-than-expected in December.
The dollar index, which tracks the performance of the greenback versus a basket of six other major currencies, was up 0.28% during European afternoon trade.
A stronger dollar makes U.S. commodities more expensive for buyers holding other currencies and reduces the appeal of the precious metal as an alternative asset.
Meanwhile, news that ratings agency Moody’s put Spain's Aa1 sovereign credit rating on review for a possible downgrade failed to support gold prices.
Global investment bank UBS said in a report late Wednesday that rating downgrades of euro zone member nations have “already been factored in by the markets and are reflected in the current [gold] price”.
Elsewhere, silver for January delivery fell 0.88% to trade at a 2-day low of USD 29.20 a troy ounce, while copper for January delivery tumbled 0.94% to trade at USD 4.162 a troy ounce during European afternoon trade.
