Gold trades below $1,300 as U.S. economy weighed with tensions
WASHINGTON. KAZINFORM - Gold held below $1,300 an ounce as investors weighed a strengthening U.S. economy and dollar against signs of easing tensions around the world.
Bullion for immediate delivery traded at $1,282.61 an ounce at 9:32 a.m. in Singapore from $1,281.20 yesterday, when prices rose as much as 1.1 percent before ending 0.3 percent higher, according to Bloomberg generic pricing. The metal on Aug. 21 dropped to $1,273.14, the lowest level since June 18, on speculation the U.S. Federal Reserve will raise borrowing costs sooner than forecast, according to Bloomberg .
The dollar climbed to its highest level in almost a year against the euro on speculation the Fed will increase rates next year, while the European Central Bank will add to stimulus. Data today may show German inflation stalled after a report yesterday showed U.S. consumer confidence rose to a seven-year high, sending the Standard & Poor's 500 Index to a record.
"Gold is helped by some safe-haven demand but U.S. economic data continues to show good growth, and we expect the strong dollar and momentum in stocks to put pressure on prices," said Huang Wei, a Shanghai-based analyst at Huatai Great Wall Futures Co. "Outflows from the SPDR also shows a slight negative trend."
Gold for December delivery lost 0.1 percent to $1,283.50 an ounce on the Comex in New York. Holdings in the SPDR Gold Trust fell yesterday for a second day.
Ukraine Talks Gold rebounded 6.8 percent this year as fighting in the Middle East and Ukraine fueled haven demand. Russian President Vladimir Putin said talks with his Ukrainian counterpart were "positive", while Israel and Hamas said they accepted an Egyptian-brokered cease-fire plan to end the conflict in Gaza.
Fed Chair Janet Yellen said on Aug. 22 at a meeting of central bankers that the U.S. labor market was healing. At the same gathering, ECB President Mario Draghi said a faltering euro-area economy might need more monetary stimulus. The Fed has cut monthly bond buying at each of the last six meetings, while borrowing costs have been near zero since December 2008.
Silver for immediate delivery advanced 0.1 percent to $19.3956 an ounce. Spot platinum was at $1,418.69 an ounce from $1,417.94. Palladium was little changed at $885.73 an ounce.