Gold Price Drifts Lower
London (Dec 30) The price of gold drifted between gains and losses on Wednesday as investors tidied up their portfolios at the end of another negative year for the precious metal.
Gold spent much of the day in negative territory, with wider losses across almost all commodities and European equity markets weighing on sentiment, analysts said.
Spot gold was down 0.10% at $1,068.25 a troy ounce in morning European trade, amid thin volumes as many investors remained off work for the Christmas and New Year holidays.
“Precious metals are mixed today, reflecting a slight pickup in risk aversion, judging by the weakening in oil prices and broad equities,” said Boris Mikanikrezai, an analyst at markets research firm Fastmarkets.
Gold also saw headwinds from a slightly stronger dollar, with the WSJ Dollar Index down 0.03%.
The precious metal had finished lower on Tuesday, after strong U.S. consumer confidence data bolstered the case for the Federal Reserve to raise rates at a faster clip. Gold, which pays its holders nothing, struggles to compete with yield-bearing investments when borrowing costs rise.
Those two factors, a strong dollar and rising U.S. interest rates, are expected to weigh on gold next year, after pushing the precious metal to its third consecutive annual loss in 2015
Among the other precious metals, spot silver was down 0.57% at $13.88 an ounce and spot platinum fell 0.19% at $887.27 an ounce, while palladium was up 0.04% at $554.00 an ounce.