Gold Prices Settles Lower; Silver Prices also Slip
Gold prices fell on Monday as stability in the global equity markets induced investors to cut positions on safe haven bets while a broadly higher U.S. dollar also hurt the demand. Silver prices also edged lower in trading on Monday.
Besides, investors also remained in sidelines ahead of the outcome of the Federal Reserve’s open market committee meeting. The two-day FOMC meeting will start from Tuesday. Investors are anxious to find out what would be the Federal Reserve’s stance on its bond purchase program.
In a note to clients, Robin Bahr an analyst at Societe Generale said, “People are looking for more clarity—or not, as the case may be—on whether the Fed starts to ease off the Quantitative Easing bandwagon,” according to Reuters.
With U.S. job and housing market suggesting significant improvement in the U.S. economy, speculation is rising that the Fed might opt to taper its multi-billion dollar bond purchase program (quantitative easing sooner than later. Earlier today, the Wells Fargo/ NAHB’s housing index showed that homebuilders’ sentiment rose to its highest level since April 2006.
“We think that all the ingredients are in place with an economy that looks to be improving, albeit gradually,” added Bahr.
U.S. gold futures for August delivery edged down $4.50, or 0.3%, to settle at $1,383.10 an ounce while spot gold was last down 0.59% to $1,382 an ounce.
In late trading, the SPDR Gold Trust (ETF) (NYSE: GLD) was down 0.59% to $133.64.
Silver futures were last down 0.97% to $21.74 an ounce.
Meanwhile, hedge funds and money managers cut their bullish positions on gold futures and options for the week ended June 11, showed a data provided by Reuters/ Commodity Futures Trading Commission.
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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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