January 8, 2014 / 3:22 AM / 4 years ago

PRECIOUS-Gold dips on stronger equities, U.S. growth hopes

* U.S. trade data boosts shares, economic outlook
    * Stronger dollar also hurts gold
    * Coming up: Minutes of Fed Dec meeting at 1900 GMT

 (Updates prices)
    By A. Ananthalakshmi
    SINGAPORE, Jan 8 (Reuters) - Gold eased for a second session
on Wednesday as equities inched higher on optimism over U.S.
economic growth, curbing bullion's safe-haven appeal. 
    Prices were hurt by data showing the U.S. trade deficit fell
to a four-year low in November as exports hit a record high and
weak oil prices held down the import bill. 
    The numbers, the latest in a string of strengthening
economic fundamentals, left economists anticipating a far
stronger pace of growth for the fourth-quarter than previously
expected.
    "The global economy will continue to stabilise in the next
few months, so we won't have much acceleration of prices," said
Alexis Garatti, an economist at Haitong International Research
in Hong Kong.
    A strong economy and higher equities curb demand for gold,
which is seen as an alternative investment. 
    Gold prices will decline in the first half of the year, but
may steady in the latter half as fundamentals improve, Garatti
said.
    Spot gold had eased 0.2 percent to $1,228.60 an ounce
by 0737 GMT, after snapping a five-day rally on Tuesday. 
    Asian shares climbed on the U.S. trade data, while the
dollar was hovering near a one-month high. 
    Markets are awaiting the release of the minutes of the
Federal Reserve's December meeting - when the bank decided to
cut its $85 billion in monthly bond purchases - to gauge the
pace at which the central bank will scale back stimulus. 
    Two top Fed officials said they expected the bank to reduce
stimulus at a steady pace, with the lone official to dissent
against the bank's decision to trim its bond buying saying he
was comfortable with the approach. 
    On the physical side, the pace of Chinese buying seemed to
have dipped slightly on Wednesday after a frantic buying spree
earlier this week, based on volume and price data on the
Shanghai Gold Exchange.
    Premiums eased to $17 on Wednesday from over $20 seen
earlier this week. Trading volumes on Monday hit their highest
in eight months but have since slowed.
    
    PRICES AT 0737 GMT    
 Metal            Last     Change   Pct chg
                                              
 Spot gold         1228.6    -2.89       -0.23
 Spot silver        19.66     -0.2       -1.01
 Spot platinum     1405.1    -5.65        -0.4
 Spot palladium    735.75    -2.75       -0.37
 Comex gold        1227.7     -1.9       -0.15
 Comex silver      19.665   -0.122       -0.62
                                              
 COMEX gold and silver contracts show the most
 active months
 
 (Reporting by A. Ananthalakshmi; Editing by Joseph Radford and
Sunil Nair)

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