Gold Prices Hammered; Silver Prices Also Slip
Gold prices fell sharply for yet another session on Thursday as edgy investors continued to liquidate inflation-hedge bets amid rising speculation that the Federal Reserve could soon start to taper its economic stimulating measures. Silver prices also fell in trading on Thursday.
Gold staged a modest comeback during Asian trading hours but series of solid U.S. economic data releases, later during the day, wiped out all gains as liquidations intensified.
U.S. gold futures for August delivery plunged $18.20 an ounce, or 1.5%, to settle at $1,211.60 while spot gold slumped 1.99% to $1,200.84 an ounce.
Silver futures were last down 0.87% to $18.43 an ounce.
While the job market continued to show gradual recovery, (weekly jobless claims were broadly in line-with economists’ expectation), pending home sales rose 6% in May to reach its highest level in last six years, showed a data provided by the National Association of Realtors.
Gold prices are now down about 26% from the start of this year and are heading towards logging worst quarterly performance since 1968, showed a data provided by Reuters.
The yellow metal has come under immense pressure after the Federal Reserve Chairman Ben Bernanke signaled at possible winding down of the bond purchase program by the year end and complete halt by the second half of the next year, should economic indicators, especially the labor market continued to show improvement.
Meanwhile, holdings of the SPDR Gold Trust (ETF) (NYSE: GLD), the world’s largest gold-backed ETF, remained unchanged on Wednesday but are at multi-year low levels.
A data provided by Reuters showed that the fund’s holdings fell 1.7 percent or 16.23 tons on Tuesday, a second biggest one-day drop recorded this year.
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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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