Gold slides lower but remains close to 1-year peak
London (Mar 18) Gold slid lower in European morning hours on Friday, but remained within close distance of a one-year high as sentiment on the U.S. dollar remained vulnerable after the Federal Reserve’s most recent policy statement.
On the Comex division of the New York Mercantile Exchange, gold futures for April delivery were down 0.43% at $1,259.60.
The April contract ended Thursday's session 2.86% higher at $1,265.00 an ounce.
Futures were likely to find support at $1,234.50, the low of March 14 and resistance at $1,280.70, the high of March 11 and a one-year high.
The dollar came under broad selling pressure after the Fed left its monetary policy unchanged on Wednesday and said that it is likely to raise interest rates twice this year – and not four times, as initially estimated.
Fed policymakers said the U.S. economy faces risks from an uncertain global economy, although moderate growth and "strong job gains" would allow it to tighten policy this year.
The greenback found some support however after the U.S. Department of Labor said on Thursday that jobless claims rose less-than-expected last week.
In addition, the Federal Reserve Bank of Philadelphia said that its manufacturing index improved to 12.4 this month from February's reading of -2.8.
The U.S. dollar index, which measures the greenback’s strength against a trade-weighted basket of six major currencies, was up 0.25% at 95.01 in early European trade, off a fresh five-month low of 94.61 hit overnight.
Gold prices are up nearly 16% so far this year as investors seek safe havens in the face of mounting instability in other financial markets and as fears over a China-led global economic slowdown make it tougher for the Fed to raise rates.
Elsewhere in metals trading, silver futures for May delivery was steady at $16.030 a troy ounce, while copper futures for May delivery gained 0.28% to $2.299 a pound.