Gold prices sank below $1,600 an ounce Wednesday and toward a five-month low when the U.S. dollar rallied as the euro fell to its lowest level since January. Gold was also pressured, opined analysts, from news that the Fed would avoid new stimulus programs.
"There is turbulence across the commodity market because of the strength in dollar," Jochen Hitzfeld, an analyst at UniCredit SpA in Munich, said in a telephone interview that was recounted on Bloomberg. "No further stimulus from the Fed is bearish for the market."
Gold prices declined $76.20, or 4.6 percent, to $1,586.90 an ounce in the February futures contract on the Comex in New York. It was gold’s lowest settlement price since July 13 and the first time it traded below $1,600 an ounce since September 29. Jon Nadler, Senior Analyst at Kitco Metals Inc, noted the following earlier Wednesday.
"The price washout in precious metals intensified in the wake of the Fed’s failure to please the markets with more stimulative action. The disappointment was palpable and when combined with the on-going angst surrounding the European debt debacle, the sentiment resulted in fresh two-month lows for gold and significant breaches of long-standing moving averages. The domino theory in action here, and now. Curiously, the one domino that was supposed to be ‘toast’ by now — the USD — is not only standing, but it is taking out the 80.50 (!) level on the index."
Gold’s lowest point of the day came in at $1,565.70 and it reached a high at $1,645.80 — an $80.10 difference. Similar price swings could be all too common, according to James Steel, chief technical analyst at HSBC.
"Some macro hedge funds are liquidating gold holdings and taking profits in a difficult year. As trading volume typically drops toward year-end, we expect increasingly volatile price swings," Reuters quoted Steel.
Silver prices for March delivery plummeted $2.325, or 7.4 percent, to settle at $28.935 an ounce. Silver prices touched a low at $28.530 and hit a high at $31.070 — a difference of $2.54.
Platinum prices for January delivery declined $66.00, or 4.4 percent, to $1,426.30 an ounce, trading between $1,408.50 and $1,484.10.
Palladium prices for March delivery dived $44.55, or 6.7 percent, to $619.60 an ounce, ranging from $600.50 to $649.50.
London Precious Metals
London precious metals losses were severe as well, but to a bit lesser degree than futures in New York. When comparing London fixings on Wednesday (PM) from those on Tuesday (PM), gold declined $69.50 to $1,603.00 an ounce, silver prices fell $1.42 to $29.92 an ounce, platinum lost $38.00 to $1,454.00 an ounce and palladium declined $44.00 to $617.00 an ounce.
U.S. Mint Bullion Coins
U.S. Mint gold bullion coins have moved forward in seven of the last eight days, maintaining a trend this year of rising quicker as precious metals fall faster. Of note, the Mint’s popular one ounce bullion coins in the first 14 days of December have already surpassed each of their previous monthly sales totals.
On Wednesday, the American Gold Buffalo gained 1,500, bringing their December sales to 10,500. The 24-karat bullion coins jumped past their November sales of 8,500 on Tuesday.
The 22-karat American Gold Eagle stands at 41,500 for the month after a daily increase of 9,000. That gain lifted their monthly sales over November’s total of 38,500.
Finally, the American Silver Eagle advanced 50,000 to reach 1.406 million for the month. The daily increase drove the .999 fine silver bullion coins over their prior monthly sales of 1.384 million.
The latest daily, monthly, and year-to-date U.S. Mint bullion coin sales follow:
|Sales of U.S. Mint American Eagle and Buffalo Bullion Coins|
|Daily Gains||December Gains||YTD 2011|
|American Gold Eagle Coin (1 oz.)||9,000||41,500||886,000|
|American Gold Eagle Coin (1/2 oz.)||0||0||65,000|
|American Gold Eagle Coin (1/4 oz.)||0||0||82,000|
|American Gold Eagle Coin (1/10 oz.)||0||0||370,000|
|American Gold Buffalo Coin (1 oz.)||1,500||10,500||164,000|
|American Silver Eagle (1 oz.)||50,000||1,406,000||39,265,500|
|Sales of America the Beautiful 5 Oz. Silver Bullion Coins*|
|Gains Over Last Week||YTD 2011|
|Gettysburg National Military Park 5 oz. Silver Coin||n/a – sold out||126,700|
|Glacier National Park 5 oz. Silver Coin||n/a – sold out||126,700|
|Olympic National Park 5 oz. Silver Coin||0||83,300|
|Vicksburg National Military Park 5 oz. Silver Coin||0||32,500|
|Chickasaw Park 5 oz. Silver Coin||400||25,100|
*The United States Mint does not provide daily sales figures for its 5-ounce silver coins. The sales are current as of Monday, December 12, 2011.