Gold prices fell sharply to a two-month low Thursday, pounded by the stronger dollar which benefited from better than expected employment and housing data.
February gold prices lost $23.70, or 1.7 percent, to $1,346.50 an ounce on the Comex in New York. Prices ranged from a high of $1,370.90 to a low of $1,342.40 — the lowest level since November 19.
While housing starts data was bearish on the previous day and dragged the greenback down, existing homes sales data released Thursday showed a jump of 12.3 percent in December to an annual rate of 5.28 million. That combined with an unexpected 37,000 drop in weekly U.S. jobless claims were supportive of the dollar which weighed heavily on precious metals. News that China’s GDP advanced 9.8 percent during the fourth quarter was also cited for pressuring metals.
"Investors are hitting the sell button on gold today," Adam Klopfenstein, a senior market strategist at Lind- Waldock in Chicago, said and was quoted on Bloomberg. "China’s going to take more steps to tighten and that’s going to be bearish for commodities."
"The price of gold bullion fell hard in the wake of the Chinese news, and after the yellow metal was unable to stage an assault to successfully overcome resistance barriers at higher levels over recent sessions," noted Jon Nadler, Senior Analyst at Kitco Metals Inc. "Gold is evidently reflecting the shifting market sentiment that has been manifest since near the end of last year."
U.S. gold prices soared 29.7 percent last year, marking their 10th annual gain. The yellow metal is down 5.3 percent in 2011 and on track to record its first monthly loss since July.
Silver prices for March delivery plummeted $1.328, or 4.6 percent, to $27.473 an ounce. They ranged from $27.375 to $28.780. Silver soared 83.7 percent last year but it has plunged 11.2 percent this year.
Platinum prices for April delivery lost $19.50, or 1.1 percent, to $1,818.60 an ounce. The metal has gained 2.3 percent in 2011 and rose 20.9 percent in 2010.
Palladium prices for March delivery declined $3.90, or 0.5 percent, to $815.85 an ounce. Palladium is up 1.5 percent this year following an increase of 96.5 percent in 2010.
In PM London bullion prices, the benchmark gold Fix declined $26.50 from the previous PM fixing to $1,345.50 an ounce. The silver fixing was $28.410 an ounce, falling 91.0 cents. Platinum was $1,809.00 an ounce, dropping $36.00. Palladium was lower by $19 with its fixing at $805.00 an ounce.
U.S Mint bullion coin sales figures remained unchanged for a second straight day. For an analysis of recent bullion and numismatic U.S. Mint sales, read Silver Eagles Break Monthly Record.
|U.S. Mint 2011 Bullion Coin Sales|
|Daily Gain||January Totals|
|American Eagle Gold Coin (1 oz)||0||73,000|
|American Eagle Gold Coin (1/2 oz)||0||1,000|
|American Eagle Gold Coin (1/4 oz)||0||2,000|
|American Eagle Gold Coin (1/10 oz)||0||15,000|
|American Eagle Silver (1 oz)||0||4,588,000|