Gold futures fell nearly 2 percent in New York on Friday, a day after they hit a 5-1/2-month high, hurt by technical selling by funds, a sharply higher dollar and news that the United States had no plans to go to war with Iran.
At 10:41 am EST (1541 GMT), most-active gold for April delivery on the COMEX division of the New York Mercantile Exchange was down $10.60, or 1.6 percent, at $652.40 an ounce, trading between $655.30 and $665.30 an ounce.
Gold futures hit a low of $650.00, after US Defence Secretary Robert Gates told reporters that "we are not planning a war with Iran." Gold prices usually rise with geopolitical tensions because of the precious metal's safe-haven appeal. Leonard Kaplan, president of Prospector Asset Management, said that a technical sell-off, primarily by funds, was triggered once the April contract fell below $660 an ounce.
One futures commission merchant attributed gold's strength on Thursday to a technical breakout and added that it was important to climb above the $660 an ounce level. "But this kind of reversal that we're looking at right now certainly appears like it may have been reversed," he said. He added that the reverse in the dollar's strength was one of the reasons why gold and silver fell early Friday.
The dollar rose in a technical rebound. The euro fell against the dollar, trading below the psychologically important $1.3000 level. The US Commerce Department said that the economy added a weaker-than-expected 111,000 jobs in January, and the unemployment rate rose to 4.6 percent for the month, the highest since a matching rate in September of last year.
George Gero, vice president at RBC Capital Markets Global Futures, described the job data as "anti-inflationary." Gero also said that Friday's selling was related to profit taking before the weekend. On Thursday, gold futures hit their loftiest level since August, and they have also finished higher for the last three consecutive sessions before Friday's decline.
Spot gold was quoted at $647.00/7.75 an ounce, compared with $657.00/7.40 traded late Thursday. London's afternoon gold fix was $645.70. In other precious metals, COMEX March silver was down 37.0 cents, or 2.7 percent, at $13.355 an ounce, trading in a range between $13.255 and $13.755.
Spot silver fell to $13.290/3.340, below its late Thursday quote of $13.620/3.690. Silver was fixed in London at $13.660 an ounce. NYMEX April platinum dropped $28.30, or 2.4 percent, to $1,164.50 an ounce. Spot platinum fetched $1,157.00/62.00. NYMEX March palladium was down $8.90, or 2.6 percent, at $336.00 an ounce. Spot palladium was quoted at $338/343.00.
Comments
Comments are closed.