Gold price struggles for direction in thin year-end trading
New York (Dec 30) Gold prices struggled for direction in quiet year-end trading on Wednesday, as investors looked ahead to upcoming U.S. data to gauge if the world's largest economy is strong enough to withstand further rate hikes in 2016.
Trading volumes are expected to remain light in the final few days of the year, reducing liquidity in the market.
Gold for February delivery on the Comex division of the New York Mercantile Exchange tacked on 10 cents, or 0.01%, to trade at $1,068.10 a troy ounce during European morning hours. A day earlier, gold dipped 30 cents, or 0.03%.
Market participants were eyeing a report on U.S. pending home sales due later in the day after a recent run of mixed economic data failed to offer clues as to how fast the Federal Reserve will raise interest rates next year.
With the first U.S. rate hike since 2006 out of the way, investors are now focusing on the pace of future rate increases. The Fed, from its forecasts, is anticipating four rate hikes next year.
Gold is on track to post an annual decline of approximately 10% in 2015, the third yearly loss in a row, as speculation over the timing of a Fed rate hike dominated market sentiment for most of the year.
Meanwhile, silver futures for March delivery dipped 4.3 cents, or 0.31%, to trade at $13.88 a troy ounce. Silver is on track to post an annual decline of nearly 10% in 2015.
Elsewhere in metals trading, copper shed 0.2 cents, or 0.08%, to $2.135 a pound. The red metal is on track to post an annual decline of almost 30% in 2015 amid concerns over China's economic outlook and its impact on future demand prospects.
The Asian nation is the world’s largest copper consumer, accounting for nearly 45% of world consumption.