Gold Ends Lower On Strong Dollar, US GDP Data
Washington (Dec 23) Gold futures ended lower on Tuesday, tracking rising global equity markets after a final reading showed US economy to have grown more than expected in the third quarter, with the dollar also strengthening against a basket of major currencies.
A Commerce Department report on Tuesday showed US gross domestic product increased much more than previously estimated in the third quarter, reflecting notably stronger consumer spending growth.
A Commerce Department report on Tuesday showed US personal income to have risen less than expected in November, but personal spending increased more than expected.
Nonetheless, the decline in gold prices were somewhat capped after some soft durable goods and new single-family houses sales data from the US
A report from the Labor Department showed new orders for US manufactured durable goods unexpectedly decreased in November, while another report from the Commerce Department showed sales of new single-family houses in the US to have unexpectedly declined in November.
With holidays for Christmas and the New Year ahead, trading volumes continued to remain quite thin and are likely to remain so for the rest of the week.
Gold for February delivery, the most actively traded contract, dropped USD1.80 or about 0.2%, to settle at USD1,178.00 an ounce on the Comex division of the New York Mercantile Exchange on Tuesday.
Gold for February delivery scaled an intraday high of USD1,184.90 and a low of USD1,173.00 an ounce.
On Monday, gold futures ended higher at USD1,179.80 an ounce, down USD16.20 or 1.4%, as global equity markets trended higher with demand for the safe haven metal waning.
Holdings of SPDR Gold Trust , the world's largest gold-backed exchange-traded fund, remained unchanged at 724.55 tons from its previous close on Monday.
The dollar index, which tracks the US unit against six major currencies, traded at 90.05 on Tuesday, up from its previous close of 89.78 late Monday in North American trade. The dollar scaled a high of 90.16 intraday and a low of 89.63.
The euro trended lower against the dollar at USD1.2175 on Tuesday, as compared to its previous close of USD1.2232 late Monday in North American trade. The euro scaled a high of USD1.2247 intraday and a low of USD1.2165.
In economic news from the US, a Commerce Department report said a final reading on third quarter US GDP showed the economy to have grown 5.0% compared to the previously estimated 3.9% growth. Economists expected the pace of GDP growth to be upwardly revised to 4.3%.
A report from the Labor Department showed new orders for US manufactured durable goods in November dropped 0.7%, against an increase of 0.3% in the preceding month. Economists expected orders to surge up by 0.3%. Excluding orders of transportation equipment, durable goods orders fell by 0.4% in November, after edging down by 0.1% in October.
A report from Thomson Reuters and the University of Michigan said the consumer sentiment index for December was downwardly revised to 93.6 from the mid-month reading of 93.8. Economists had expected the index to be downwardly revised to 93.0.
Sales of new single-family houses in the US unexpectedly tumbled 1.6% in November to a seasonally adjusted annual rate of 438,000 from the revised October rate of 445,000. Economists expected new home sales to inch up to an annual rate of 460,000 in November from the 458,000 originally reported for the previous month.
Personal income in the US increased 0.4% in November following an upwardly revised 0.3% increase in October. Economists expected personal income to climb by 0.5% compared to the 0.2% growth originally reported for the previous month.
Personal spending in the US climbed 0.6% in November against economists' expectation of a 0.5% increase.
Meanwhile, the International Monetary Fund economists expect global GDP to grow by 0.3 to 0.7% in 2015, thanks to lower oil prices.