Gold prices were on track for the second day of losses as stronger-than-expected report on retail sales hit haven demand and helped US stocks.
February delivery gold dropped or 0.9% or $11.40 to $1,218.00 per ounce. March silver declined 1% or 17 cents to $17.02 per ounce, as reported by Market Watch.
Meanwhile, the US stock market has been climbing smartly in the early going following the beat down of Wednesday.
The US economic front, the Commerce Department released a report that was stronger than expected on the readings of US retail sales, which appeared to weigh on haven demand for gold.
Gold had been down before that reading and extended its loses after. The weekly jobless claims were 294,000 and economists were expecting 296,000.
David Gurwitz of Charles Nenner Research said that he expects gold to return to its highs, but this does not mean that it is going to start that journey soon.
He said, “Long-term cycles have bottomed. But just because the cycles bottom, it doesn’t mean it is ready to go right away. They can stay bottomed for a while.”
According to Reuters, the dollar has been up 0.4% against the basket of currencies and it is expected to become firmer ahead of next week’s meeting of the US Federal Reserve policy.
The meeting is expected to give clues on when the central bank will hike interest rates. Sooner-than-expect hikes in interest rates might boost the dollar but these might also hurt non-interest bearing bullion.
Robin Bhar, Societe General said, “The market’s focus is on the ‘considerable time’ language, whether the Fed will take that out or not. We think the first interest rate hike might happen in June 2015.”
January platinum dropped 0.8% or $9.30 to $1,233.30 per ounce and March palladium dropped 0.45 or $3.40 to $818.00 per ounce.
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