Investing.com - Gold prices eased in Asia on Friday on continued
expectations that the Federal Reserve will wind down monthly asset
purchases this year and begin hiking benchmark interest rates in
On the Comex division of the New York Mercantile Exchange, gold
futures for June delivery traded at $1,293.90 a troy ounce, down
0.07%, after hitting an overnight session low of $1,291.40 and off
a high of $1,307.40.
A fresh batch of improving U.S. economic indicators kept
expectations firm that the Federal Reserve will wind down monthly
asset purchases this year and hike rates the next, which
strengthened the dollar on Thursday.
Gold and the dollar tend to trade inversely with one another.
The Fed's asset-purchasing program, currently set at $55 billion in
Treasury and mortgage debt a month, weakens the dollar by
suppressing long-term interest rates to spur investing and hiring,
thus boosted gold's appeal as a hedge.
The Commerce Department reported earlier that U.S. gross domestic
product was revised up to 2.6% in the final three months of 2013,
from a preliminary estimate of 2.4%. Market expectations had been
for an upward revision to 2.7%.
Still, the report showed that personal spending was revised up to
3.3% from 2.6% initially, the fastest rate of growth in three
years, which drew applause from investors.
Separately, the Labor Department said the number of individuals
filing for initial jobless benefits in the U.S. last week declined
by 10,000 to a 311,000 from the previous week's revised total of
Analysts were expecting jobless claims to rise by 4,000.
Thursday's data fueled already growing opinions that a spate of
disappointing economic indicators released earlier in the year were
the product of rough winter weather and not due to an underlying
decline in demand.
Investors shrugged off a National Association of Realtors report
revealing that its pending home sales index dropped by 0.8% last
month, disappointing expectations for a 0.3% gain.
Pending home sales for January were revised down to a 0.2% decline
from a previously reported gain of 0.1%.
Year-on-year, pending home sales fell at annualized rate of 10.2%
in February, worse than expectations for a 8.5% decline, after
declining 9.3% in January, though rough winter weather may have
been a factor.
Meanwhile, silver for May delivery rose 0.44% at US$19.795 a troy
ounce, while copper futures for May delivery were up 0.51% at
US$3.008 a pound.
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