Gold Prices Edge Lower; Silver Prices also Slip
Gold prices edged lower in trading on Thursday as the U.S. dollar strengthened after data showed that the euro zone slipped back into recession. Silver prices also edged lower on Thursday.
Gold tracked losses in the equity market, which were dragged lower by concerns over the U.S. fiscal cliff, the euro zone and the geopolitical tensions in the Middle East.
On Thursday, a report showed that the euro zone slipped into a recession, even as Germany, the region’s largest economy, registered a 0.2% GDP growth in the third quarter.
Spot gold fell more than 1% to $1,708 an ounce, while gold futures for delivery in December on the Comex division of the New York Mercantile Exchange settled $15 lower at $1,715.60 an ounce.
Speaking to Reuters, Nic Brown, analyst at Natixis, said that you get periods of high correlation between risky assets and this seems to be happening now and there are times when gold is just another commodity. Brown, however, noted that concerns over the looming fiscal cliff may boost gold’s appeal as a safe haven if negotiations over how to tackle the issue are prolonged.
Gold fell on Thursday despite a rise in oil prices due to geopolitical tensions in the Middle East. The violence in Gaza Strip has sparked concerns about a possible disruption of oil supply from the Middle East. Gold, which is seen as an inflation hedge, generally benefits from rising oil prices. However, this wasn’t the case on Thursday as the precious metal slipped.
Silver also fell on Thursday. At last check, spot silver was down nearly 1% to $32 an ounce.
In late trading on Thursday, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.46%, the ProShares Ultra Silver (ETF) (NYSE: AGQ) was down 0.77%, and the ProShares UltraShort Silver (ETF) (NYSE: ZSL) was up 0.89%.
Platinum and palladium also edged lower. At last check, spot platinum was trading 1% lower at $1,568 an ounce, while spot palladium was trading almost 1% lower at $628 an ounce.
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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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