Gold futures for June delivery GCM2 -1.60% lost $27.50, or 1.6%, to $1,644.30 an ounce on the Comex division of the New York Mercantile Exchange during the Asian session.
The losses added to a 0.5% drop notched Tuesday in the North American session, after minutes from the Federal Reserve signaled central-bank officials were less interested in so-called quantitative easing through bond buys.
Expectations of monetary stimulus tends to benefit gold, as the metal is seen as a safe store of value and inflation hedge.
The dollar, meantime, rallied after the Fed minutes and continued to strengthen during Asian trading on Wednesday.
The dollar index DXY +0.14% , which tracks the U.S. unit against a basket of six other currencies, rose to 79.5190, from 79.410 in North American trade late Wednesday.
A higher greenback tends to pressure dollar-denominated commodities as it makes them more expensive to holders of other currencies.
“The impact of a higher U.S. dollar on the gold price will be particularly pronounced given that a large majority of gold is invested in the U.S.,” strategists at the National Australia Bank said.
“In the medium-to-longer term, we expect more certainty surrounding the European sovereign debt situation to emerge, while a relatively stronger U.S. dollar and a return to fundamentals should also help to lower prices,” the strategists added.
The National Australia Bank forecast gold to trade at around $1,620 an ounce over the June 2012 quarter.
The broader metals complex tracked gold lower, with silver leading declines.
Silver for May delivery SIK2 -2.57% plunged 2.9%, or 97 cents, to $32.30 an ounce. May copper HGK2 -1.33% dropped 1.4%, or 5 cents, to $3.87 a pound.
Palladium for June delivery PAM2 -1.14% slumped $9.60, or 1.5%, to $650.00 an ounce, while platinum for July delivery PLN2 -1.05% dropped $18.20, or 1.1%, to $1,642.80 an ounce.
For the latest updates on the stock market, visit Stock Market Today For the latest updates PRESS CTR + D or visit Stock Market news Today
No comments:
Post a Comment