On the back of last month's stellar Non-farm payroll report, stronger US data is likely to continue propping up the greenback at the expense of gold. The 9ct hallmarked gold scrap prices declined to $388.394 an ounce and 14ct hallmarked gold scrap prices dropped to $605.895 an ounce.
The most active gold contract for December delivery on Friday fell $1.6 (0.15 percent) to settle at $1,076.30 per ounce, Xinhua reported. The market interpreted the news to mean a December rise in US interest rates is still likely, but further hikes will be staggered slowly.
Rising rates tend to weigh on gold, as they lift the opportunity cost of holding non-yielding bullion, while boosting the dollar, in which it is priced. Gold prices were pressured by Dudley's comments as well as the firm United States dollar, said Eli Tesfaye, senior market strategist for brokerage RJO Futures in Chicago. On Wednesday, the metal sunk to $1,062, the lowest since February 2010.
Expect gold to be under more pressure today, as investors cash in on the short term gains and the focus once again turns to the Fed's next interest rate move.
The dollar edged lower against a basket of currencies on Thursday, with a few analysts arguing that it will now take more than next month's expected action on euro zone and USA monetary policy to drive the US unit higher. World shares and risk assets rallied after the Fed flagged a rate hike next month, but also an intention to move cautiously on rates from there. "Although rapid commodity output growth in recent years, which has reflected in part the response of producers to previous price increases, has certainly contributed to the fall in commodity prices, the slowing of demand growth from China and emerging Asia has also been an important factor", Mr. Fischer said in his speech. "We seem to have bounced off the lows for now".
Bullion for immediate delivery rose as much as 0.4% to $1 086.64 an ounce and was at $1 085.72 2:13pm in Singapore, according to Bloomberg generic pricing.
South Africa's Gold Fields Ltd is considering putting its Damang mine in Ghana "under care and maintenance" until gold prices recover, it said on Thursday.
Source: http://tpmelectioncentral.com/2015/11/21/gold-up-on-weaker-us-usa-dollar.html
