Stock Market Watch

Gold Prices Slip as Dollar Gains After GDP Data; Silver Prices Flat

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Gold prices slipped on Wednesday as the U.S. dollar gained traction after the U.S’s preliminary reading on the second quarter GDP showed that world’s largest economy grew at faster than expected rate, fuelling speculation that the Federal Reserve could soon start tapering its multi-billion bond purchase program. Silver prices were also flat in early trading on Wednesday.

At last check, gold futures slid 0.12% to $1,323.20 an ounce while spot gold edged down 0.22% to $1,323.74 an ounce.

The U.S. GDP rose at an annualized rate of 1.7% in the second quarter, comfortably beating economists’ forecast for 1.0% growth, according to a poll conducted by Reuters.

Meanwhile, all eyes will now focus on the Federal Reserve’s policy rate statement, later today. The Fed’s open market committee meeting (FOMC) will end today at 2:00 p.m. EST followed by its Chairman Ben Bernanke’s press conference. Even though the Fed has made it clear that it will continue to keep interest rates at record low levels for a prolonged period in its last FOMC, market participants are anxious to know when the bank would start winding down its bond purchase program.

In his latest congressional testimony, Bernanke had said that the bank could start scaling down the pace of economic stimulating measures later this year.

“Any mention of September as the timing for the central bank’s tapering of QE3 would be dollar-positive and could still sink gold back below $1,300,” said  Andrey Kryuchenkov, an analyst at  VTB Capital, according to Reuters.

The U.S. dollar index was last up 0.28% at 82.07.

Silver futures were flat at $19.68 an ounce.

In pre-market trading, the iShares Silver Trust (ETF) (NYSE: SLV) was down 0.05%, and the ProShares Ultra Silver (ETF) (NYSE: AGQ) was flat.








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edliston
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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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.

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