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Gold down on Fed speeches

Xinhua, September 29, 2016 Adjust font size:

Gold futures on the COMEX division of the New York Mercantile Exchange fell on Wednesday as traders reacted to speeches from Fed officials.

The most active gold contract for December delivery fell 6.7 U.S. dollars, or 0.5 percent, to settle at 1,323.7 dollars per ounce.

The precious metal was put under pressure as U.S. Federal Reserve Chairwoman Janet Yellen spoke before the U.S. House of Representatives' House Financial Services Committee, saying that she believes that "too big to fail" banks are less of a problem, and that the U.S. banking system has strengthened considerably.

Analysts note that although she did not speak directly on the strength of the U.S. economy, this testimony still drove investors away from gold as a safe haven as it indicated Yellen's confidence in U.S. banking stocks.

Gold was put under further pressure as the durable goods report released by the U.S. Department of Commerce on Wednesday showed new order growth unchanged during the month of August, which was on the high end of expectations, as investors had expected a decrease in the measure. Additionally, analysts note that ex-transportation orders decreased, but also on the high end of expectations.

The U.S. Dollar Index fell by 0.01 percent to 95.46 as of 1715 GMT. The index is a measure of the dollar against a basket of major currencies. Gold and the dollar typically move in opposite directions, which means if the dollar goes up, gold futures will fall as gold, measured by the dollar, becomes more expensive for investors.

Traders are looking to the week ahead for several Fed speeches on Thursday, as well as the gross domestic product, international trade in goods, and weekly jobless claims on that same day, along with the personal income and outlays report on Friday.

Silver for December delivery fell 4.4 cents, or 0.23 percent, to close at 19.121 dollars per ounce. Platinum for October delivery dropped 2.9 dollars, or 0.28 percent, to close at 1,022.3 dollars per ounce. Enditem