Gold Prices Fall Sharply; Silver Prices Also Tumble
Gold prices fell sharply on Wednesday as spate of disappointing economic data releases from the world’s top economy rattled investors, triggering across-the-board sell-off. Silver prices also fell sharply on Wednesday.
It was the biggest one-day decline in prices after mid-April’s spectacular plunge, when the metal hit a two-year low level of $1,321 an ounce.
At last check, U.S. gold futures for June delivery were down 1.21% to trade at $1,454.30 an ounce in electronic trading while spot gold fell 1.59% to $1,453.11 an ounce.
Lack of physical-side demand from Asia also kept check on prices. Most Asian markets such as China, Thailand and Hong Kong were shut due to Labor Day holiday.
Investors also remained on the sidelines as they waited for the Federal Reserve’s policy rate statement. The Fed’s policy rate announcement came after the trading at the COMEX division of New York’s Mercantile Exchange closed.
The Fed, as expected, left its benchmark interest rates unchanged and said that it will continue with its bond purchase program.
However, the metal has pared more than half the $225-per-ounce loss it suffered between April 12 and April 16, thanks mainly to robust physical-side demand from China and India, which are the world’s two biggest bullion consumer.
On Wednesday, Moody’s /ADP private sector job report showed that the U.S. economy added only 119,000 new jobs in April while economists were expecting 150,000 new jobs additions. The construction spending also fell 1.7% in March while Institute of Supply Management’s (ISM) report showed that manufacturing activities expanded at a slower-than-expected pace in April.
Silver futures were down 1.92% to $23.72 an ounce, at last check.
In late trading, the iShares Silver Trust (ETF) (NYSE: SLV) was down 1.79%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 3.55%.
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Post Written By: Ed Liston
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications. He is widely quoted in various financial publications on the Internet. When Ed is not writing about stocks, investing in stocks, talking about stocks, or otherwise doing something stock related, he likes to go sailing and fishing in his yacht.
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